At a rally in Latrobe, Pa., earlier this month, former President Donald J. Trump paused in front of a crowd holding signs that read “Save Our Steel” to pay homage to one of his favorite concepts.
Tariff, he said, “is the most beautiful word in the dictionary. More beautiful than love, more beautiful than respect.”
Mr. Trump demonstrated a deep affinity for tariffs during his presidency, using them as a cudgel to punish both allies and rivals as he tried to force companies to make their products in the United States.
If he wins again in November, he is promising a much more aggressive approach, a full-scale upending of the trading system in which the United States is no longer a partner in the global flow of goods, but a mercantilist nation intent on walling itself off from the world.
The former president, who has described himself as a “Tariff Man,” has talked about tariffs as the solution to an array of problems, from making the country rich to funding tax cuts and paying for child care. But most central to his vision is the ability of tariffs to reverse decades of globalization and force factories to move back to the United States.
Mr. Trump has threatened to slap steep tariffs on every country — the most punishing levies reserved for China — to raise the cost of foreign products and try to reorder global supply chains. His tariffs would hit almost all U.S. imports, more than $3 trillion of goods.
His approach could help some companies that are already making their products in the United States, since they would make the cost of entry higher for overseas competitors. But those benefits could be outweighed by the costs. Economists say the kind of broad-based tariffs Mr. Trump is envisioning would significantly raise prices for U.S. manufacturers and businesses that must buy material and parts from abroad. Higher prices would be passed on to U.S. consumers, with the burden falling particularly on poorer people.
Mr. Trump’s plan would also most likely incite multiple trade wars as other countries retaliate with tariffs on American goods. Those trade spats would reduce U.S. exports, disrupt global supply chains and shake the system of alliances that the United States has worked to construct since World War II.
“It’s very simple: It’s a really bad idea,” said Mark Zandi, the chief economist of Moody’s Analytics, an economics research firm.
“You’re going to push this exceptionally good economy into a ditch, and it’ll stay there until the tariffs are normalized,” he said. “If we go down the tariff war path, we’re going down a very dark path for the economy.”
Still, Mr. Trump’s pitch is resonating with voters, many of whom voted for him in 2016 because of his promises to punish China and rip up existing free trade deals like North American Free Trade Agreement. In the ensuing years, both Democrats and Republicans have embraced tariffs, particularly on products from China, as a way to reverse decades of unfettered trade that they say hollowed out American factory towns.
After initially criticizing Mr. Trump’s tariffs on more than $300 billion of products from China, President Biden chose to keep most of them, and added a few of his own. Vice President Kamala Harris’s campaign has said she plans to use tariffs in a “targeted” fashion, though she has criticized Mr. Trump’s plan for broad tariffs as a tax on consumers.
But the scale of what Mr. Trump is proposing is larger than any tariff increases that have been seen in nearly a century. He has floated a “universal tariff” of 10 to 20 percent on most foreign products and tariffs of 60 percent or more on China. To ban Chinese cars from coming into the United States via Mexico, he has said he would impose “whatever tariffs are required — 100 percent, 200 percent, 1,000 percent.”
Mr. Trump said earlier this month that the higher the tariffs, the better they would be at forcing factories to return to the United States.
“There’s another theory is that the tariff, you make it so high, so horrible, so obnoxious, that they’ll come right away,” he said during an event in Chicago.
Mr. Trump has glowingly talked of an earlier episode in American history, when the government earned its revenue through tariffs rather than through income taxes. In a podcast on Friday, he claimed the United States “was the richest” in the 1880s and 1890s, and praised President William McKinley, whose tariffs, Mr. Trump said, earned so much money that “we didn’t know what to do.”
But historians say political opinion began turning against high tariffs in the early 20th century partly because they exacerbated cronyism and burdened American consumers. The sweeping Smoot-Hawley tariff of 1930 raised import duties to protect American farmers and other businesses, setting off a trade war that exacerbated the Great Depression. Since then, U.S. officials have typically worked toward reducing trade barriers.
Maurice Obstfeld, a senior fellow at the Peterson Institute for International Economics and a former chief economist at the International Monetary Fund, said Mr. Trump’s unilateral actions could lead to a kind of global free-for-all, in which countries would discard trade rules and disregard international organizations.
“A regime of universal tariffs would really be a grenade thrown in the heart of the system,” he said.
Mr. Trump’s plans would also increase costs for consumers. One estimate by the Peterson Institute for International Economics put the annual cost at $2,600 for a typical American household. Another by the Yale Budget Lab, a nonpartisan research center, put the annual cost at $1,900 to $7,600 per household.
The costs for businesses could also be significant. Wendy Edelberg, a senior fellow at the Brookings Institution, said tariffs would force companies to raise prices, renegotiate contracts with their international suppliers and fill their warehouses in advance of the tariffs going into effect.
“We’re going to see this significant chaos across the entire business landscape,” Ms. Edelberg said in a webinar earlier this month.
In 2018 and 2019, governments around the world responded to Mr. Trump’s provocations with tariffs of their own on U.S. products ranging from motorcycles to whiskey. The retaliation was particularly painful for American farmers, prompting Mr. Trump to send them $23 billion to help offset losses. In recent months, government officials in Europe, Canada, China and elsewhere have already been drawing up lists of American products they may tax in return.
Mr. Trump has accurately assessed one thing about tariffs: They appeal to certain voters, especially those in Northern swing states who are crucial to the election. A poll put out in late September by Bloomberg News and Morning Consult found that a majority of likely voters in swing states either strongly or somewhat strongly supported the proposal to impose a 10 percent tariff on all imports.
Some academics have suggested that voters see the tariffs as a sign of politicians standing up for them against foreign countries, even if they don’t benefit them economically.
Simon Johnson, an economist at the MIT Sloan School of Management who won the Nobel Prize this month, said people were “a bit confused because Mr. Trump says that these tariffs will be paid by foreign companies.”
“That’s clearly not true,” said Mr. Johnson, who joined 22 other Nobel-winning economists in a letter this month calling Ms. Harris’s economic agenda “vastly superior” to Mr. Trump’s. “But people don’t, unfortunately, seem to grasp that.”
Anna Kelly, a spokeswoman for the Republican National Committee, said in a statement that Mr. Trump’s tariffs had “created jobs, spurred investment and resulted in no inflation.”
“Harris has always opposed tariffs because she can’t be trusted to put workers first, but President Trump will reshore American jobs, keep inflation low and raise real wages by lowering taxes, cutting regulations and unshackling American energy,” she said.
Some U.S.-based manufacturers are supportive of Mr. Trump’s plans because the tariffs will help to shield them from foreign competition. The Coalition for a Prosperous America, a pro-tariff trade group, has calculated a 10 percent tariff on all foreign products would create 2.8 million jobs and generate $728 billion of economic growth. Proponents argue that U.S. tariffs are generally lower than those of other countries. U.S. companies making kitchen cabinets, steel and bluejeans have all clamored for the protections.
But other firms argue that the higher cost of foreign parts and materials could hurt their efforts to make products in the United States.
For example, Kent International, a firm based in New Jersey that manufactures bicycles in China as well as in the United States, found itself in an odd situation after Mr. Trump introduced tariffs on bicycles and bicycle parts as part of his trade spat with China in 2018.
The company was able to obtain an exclusion from the tariffs for bicycles that were manufactured in China and imported whole, but it still had to pay a 20 percent to 25 percent tariff on bicycle parts that it brought over from China to be put together in its factory in South Carolina, said Arnold Kamler, the company’s chief executive.
Similarly, Kent International’s competitors could import complete bicycles from Taiwan or Vietnam without paying any of the China tariffs, Mr. Kamler said. That meant that a policy intended to help American manufacturers was actually putting the factory in South Carolina at a disadvantage.
”The Trump administration was very proud to say that China is paying the tariffs, and I was always very quick to say, ‘Well, if somebody in China wants to pay it, I’d be happy, but we’re paying it,’” he said.
Some analysts question whether Mr. Trump will follow through on his plans, saying the threats could just be bluster or a negotiating tactic.
But Mr. Trump has advocated tariffs for decades, and in his time in the White House, he did not shrink from taxing other countries. He raised tariffs on imports from China as well as on metals, washing machines and solar panels He contemplated closing the border with Mexico because of immigration concerns and withdrawing from the World Trade Organization. He also repeatedly bargained with Chinese leader Xi Jinping over national security sanctions.
Some of Mr. Trump’s more disruptive ideas when he was in office, like scrapping NAFTA entirely, were stayed by pro-trade advisers who stole paper off his desk and brought in maps to illustrate the importance of trade to his base.
In a second term, Mr. Trump may not be as easily reined in. Legal experts say he has the authority to impose sweeping tariffs. And Mr. Trump has been emboldened by the strong economy during his first term. “We imposed historic tariffs with no effect on consumer prices or inflation,” he said in remarks last month.
“Time warp alert!” Brian Hughes, a senior adviser to the Trump campaign, said in a statement. “Just like 2016, Wall Street and so-called expert forecasts said that Trump policies would result in lower growth and higher inflation, the media took these forecasts at face value, and the record was never corrected when actual growth and job gains widely outperformed these opinions.”
Many economists disagree, saying that while the increase in consumer prices from Mr. Trump’s past tariffs were small compared with the U.S. economy, they still occurred, and that his next plans could cover 10 times as many goods.
Mr. Johnson said the American economy was strong, resilient and diversified, meaning that it could “absorb lots of nonsense from government.” “At least up until a point,” he added.
But Mr. Trump’s proposals still wouldn’t be helpful, Mr. Johnson said, and could be particularly bad if the economy took a turn for the worse.
“In the bad times, that’s when you need real, sensible leadership,” he said.
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