by Daniel Brouse
March 20, 2025
Trump aides are preparing to implement a sweeping new set of tariffs on imports valued in the trillions of dollars, aligning with the administration’s push for a more protectionist trade policy. This plan, part of Trump’s so-called “reciprocal” trade agenda, is expected to significantly alter U.S. trade relations by targeting countries that impose tariffs or non-tariff barriers on American goods.
According to Edward Gresser, a trade policy expert, Trump’s proposed tariff plan could push the average U.S. tariff rate to levels not seen since the early 1930s—approximately 20 percent. Such a shift would mark a dramatic departure from decades of trade liberalization, reversing much of the progress made in reducing global trade barriers since World War II.
This is the first indication of the scope and magnitude of the April 2nd tariffs.
Economic and Historical Concerns
Critics warn that imposing tariffs at such high levels could trigger retaliatory measures from trading partners, leading to increased costs for American consumers and businesses. Economists and industry leaders have expressed concerns that a tariff regime reminiscent of the 1930s could result in supply chain disruptions, inflationary pressures, and reduced global economic growth. Historically, these types of tariffs were a significant factor in exacerbating the Great Depression.
There is no evidence that tariffs protect American industries or bring manufacturing back to the U.S. During Trump’s first term, the administration imposed 25% tariffs on steel and 10% on aluminum under the justification of protecting American jobs and reducing reliance on foreign imports. However, studies, including one from the Peterson Institute for International Economics, found that these policies were a net negative for the economy.
The Economic Damage of Trump’s First Tariffs
- Net Loss of 75,000 U.S. Manufacturing Jobs – While a handful of domestic steel jobs were temporarily created, the broader manufacturing sector suffered significantly. Industries reliant on steel and aluminum, such as automotive production, construction, and appliance manufacturing, faced higher input costs, leading to layoffs and production cuts.
- Each Job Saved Cost Taxpayers $900,000 – The few jobs protected by tariffs came at an extraordinarily high cost, making it one of the least efficient job protection policies in U.S. history.
- Higher Prices for American Businesses and Consumers – U.S. companies paid 15-20% more for steel and aluminum compared to international competitors, leading to price increases for consumer goods, vehicles, and infrastructure projects.
- Decline in U.S. Exports Due to Retaliatory Tariffs – In response to Trump’s tariffs, major trading partners—including Canada, China, and the European Union—imposed retaliatory tariffs on U.S. goods. This particularly hurt the agriculture sector, leading to billions in lost revenue for American farmers.
- Stock Market and Business Uncertainty – The tariffs increased economic volatility, with markets reacting negatively to heightened trade tensions and uncertainty in key manufacturing industries.
As Trump pushes forward with his sweeping tariff agenda, the potential consequences for the U.S. economy, global trade relations, and domestic industries remain a significant concern.