Trump’s tariff suicide

The U.S. President’s decision to impose extensive new tariffs has provoked opposition from America’s long-standing allies, inflamed stock markets, and heightened concerns about a potential recession. Although Trump claims his policies target all countries globally, in reality, his actions represent an overt, operational, and sustained rebellion against the structure of global trade. In clearer terms, the U.S. President has sparked a crisis that directly undermines the established and ongoing norms in international industry and trade. Interpreting Trump’s recent actions merely as a tool for gaining political and economic leverage over other countries is insufficient; they are aimed at fundamentally transforming the overarching rules of global trade.

Nevertheless, Trump’s recent move can be analyzed as a form of economic suicide. Many economic analysts in the U.S. have warned in recent days that Trump’s tariff “surgery” comes at a time when the international system has sufficient capacity to respond. The risk tolerance of some countries, including America’s European allies, toward Trump’s recent actions has increased compared to his first term (2017–2020).

The emergence of new economic structures in the international system and agreements focused on “commercial synergy among nations” to counter Trump’s unilateralism has further limited Washington’s absolute maneuverability in this arena. For instance, the European Union may impose retaliatory tariffs in response to the 25% tariffs on steel, aluminum, and automobile exports. This pattern also applies to countries like Japan, Canada, Mexico, and others.

The recent plunge in the U.S. stock market (Wall Street) indicates that, at least for now, the domestic U.S. market does not view the President’s recent actions positively. Beyond that, many private-sector stakeholders are concerned about anti-dumping policies from U.S. economic competitors, particularly China. Such measures could include reciprocal tariffs, deliberate currency devaluation, and other actions that continue to incentivize American companies to operate abroad (for production and sales).

Trump has initiated a complex game whose outcome-oriented nature is even questioned by some of his close allies. Moderating these aggressive policies also seems challenging given the intensity of Trump’s initial actions. Any revision to his recent decree will undoubtedly negatively impact his trade roadmap in confronting the World Trade Organization. Unpredictable factors cannot be overlooked either. These could include sudden actions by America’s traditional trade partners. For example, French President Emmanuel Macron recently called for a suspension of new investments by French companies in the U.S.—a decision that the U.S. Treasury Department did not anticipate so swiftly.

Collectively, these factors point to a form of economic suicide emanating from the White House. While it targets the structure of global trade, it will reciprocally have a detrimental and inhibitory effect on many components of economic growth in the United States.