As of January, President Trump’s stubborn insistence on a beggar-thy-neighbor trade policy had already cost American consumers $200 billion, and it is projected to cost at least $330 billion more this year, according to the Democratic staff of the Joint Economic Committee of Congress. This policy, if that’s the right word, has also added up to at least $166 billion in direct costs for thousands of U.S. businesses, which the government is now in the process of refunding.
The damage doesn’t stop there.
The Tax Foundation estimates that Trump’s tariffs will cost the equivalent of 367,000 full-time jobs in hours worked.
As is so often the case with the Trump administration, there may well be motives unrelated to the nation’s interest for the tariffs, which strengthened the administration politically by allowing it to grant special favors to donors and close allies.
In a July 2025 Wired article, “Trump’s Commerce Secretary Loves Tariffs. His Former Investment Bank Is Taking Bets Against Them,” Louise Matsakis and Zoë Schiffer disclosed that “a subsidiary of Cantor Fitzgerald, which is run by the sons of U.S. commerce secretary Howard Lutnick, is letting clients essentially bet that President Donald Trump’s tariffs will be struck down in court.”
Matsakis and Schiffer reported that Wired had seen a letter in which “a representative from Cantor said the firm was willing to trade tariff refund rights for 20 to 30 percent of what companies have paid in duties. ‘So for a company that paid $10 million, they could expect to receive $2-$3 million in a trade,’ the representative wrote. ‘We have the capacity to trade up to several hundred million of these presently and can likely upsize that in the future to meet potential demand.’”
Officials of Cantor Fitzgerald have repeatedly denied allegations that it is profiting from the Feb. 20 Supreme Court ruling that some of Trump’s tariffs were imposed illegally.
Cantor Fitzgerald told NOTUS that the company “has never executed any transactions or taken any position on tariffs refund claims. In July 2025, certain Cantor salespeople explored brokering tariff trades, but Cantor never executed any transactions. All reports to the contrary are false.”
In March 2025, Public Citizen released an analysis that it said described how Trump’s “first-term tariffs and exemptions to them were weaponized to reward Trump’s allies and punish his enemies.”
The exclusions process, the analysis states, was created “ostensibly to protect small businesses that would face an undue burden from Trump’s tariffs,” but
the opaque and chaotic process quickly overwhelmed government agencies and enabled a quid pro quo spoils system that rewarded the rich and well connected.
A revolving door of lobbyists, including former and future Trump administration officials, were able to secure lucrative tariff exceptions for their C.E.O. clients through political pressure, informal meetings and campaign contributions.
On Feb. 4, 2026, just over a year into Trump’s second term, two Democratic senators, Ron Wyden and Chris Van Hollen, raised concerns in a public letter that “the Trump administration appears to have created a closed-door tariff exclusion process allowing relief largely for those with political connections.”
Oregon Public Broadcasting, which covered the Wyden-Van Hollen letter, noted that it
comes at a time when President Trump is visibly favoring some companies and investors, some of whom have publicly courted him with personal gifts — like the gold-plated desk clock recently presented by Rolex’s C.E.O. — and donations to his controversial plans to build a White House ballroom.
This blurring of the lines between business and government has led political commentators and business leaders across the political spectrum to warn that the United States is tipping into “crony capitalism.”
Put another way, the Trump administration has turned the goal of governing from improving the public welfare to the generation of cash for those in power and their friends and families.
I asked trade specialists and economists what they saw resulting from Trump’s zero-sum mind-set — your loss is my gain — that often dominates his negotiating strategy, and not just on tariffs.
Ian Sheldon, an economist at Ohio State University, replied by email: “I definitely think President Trump sees trade negotiations as a zero-sum game, and does not appear to accept that multilateral and regional trade liberalization has brought mutual benefits to the U.S. and its trading partners.”
Broadly speaking, Sheldon continued, “this has resulted in five negative outcomes”:
1. The burden of U.S. tariffs has almost completely been born by U.S. importers and consumers (see the Federal Reserve Bank of New York study), and there has been little evidence of negative terms of trade effects being borne by our trading partners through lower export prices;
2. China has retaliated aggressively to U.S. tariffs, reorganizing its value chains and negatively impacting sectors such as U.S. agricultural exports;
3. “Deals” have been struck with, say, the E.U. and U.K. where the latter have made specific market access commitments in exchange for somewhat lower U.S. tariffs, the outcome appearing rather biased against these countries;
4. The chaotic/transactional nature of U.S. trade policy has increased the level of trade policy uncertainty which is likely reducing investment in trade — my guess is that the type of leverage the U.S. is applying to Canada through the use of Section 338 tariffs is doing exactly this, and could well undermine the U.S.M.C.A. negotiations;
5. By applying unilateral and discriminatory tariffs against the majority of its trading partners, along with blocking appointments to the W.T.O.’s Appellate Body, the U.S. is undermining key pillars of the multilateral trading system — reciprocity and nondiscrimination — a system that it gave leadership to until recently.
The overwhelming body of evidence, much of it from government sources and nonpartisan think tanks, has found Trump’s trade policies impose far more costs than generate benefits.
In March 2019, a quartet of economists — Pablo D. Fajgelbaum, Pinelopi K. Goldberg, Patrick J. Kennedy and Amit K. Khandelwal — wrote about Trump’s first foray into tariffs in “The Return to Protectionism”:
Import and retaliatory tariffs caused large declines in imports and exports. Prices of imports targeted by tariffs did not fall, implying complete pass-through of tariffs to duty-inclusive prices. The resulting losses to U.S. consumers and firms who buy imports was $51 billion, or 0.27 percent of G.D.P.
The aggregate real income loss was $7.2 billion, or 0.04 percent of G.D.P. Import tariffs favored sectors concentrated in politically competitive counties, and the model implies that tradeable-sector workers in heavily Republican counties were the most negatively affected due to the retaliatory tariffs.
The Fajgelbaum et al. paper was among the early studies of Trump tariffs, which have since ballooned into a cottage industry.
The critiques of Trump’s policies come from organizations on the left and on the right. One of the toughest comes from the conservative think tank founded by Mike Pence, Advancing American Freedom.
In a detailed analysis, “Tariffs Tank Employment: Assessing One Year of Liberation Day Evidence,” its authors found that “Across the first year of Liberation Day tariffs (April 2025 through March 2026), manufacturing employment shrank by approximately 6,250 jobs monthly on average,” and there was a slowdown across sectors “on the order of 75,000 to 80,000 fewer jobs per month, or roughly 900,000 fewer jobs over a year relative to the pre-Liberation Day trajectory.”
The report concluded,
The Liberation Day tariffs were the largest single-episode increase in effective U.S. tariff rates since the eve of the Great Depression. As a result, families and businesses are paying more for both imported and domestically produced goods.
Economic growth declined, and foreign direct investment fell. Farm bankruptcies spiked as export markets shrank and machinery and fertilizer costs rose. Manufacturers dependent on imported components became less competitive globally. The unlawful tariffs triggered retaliatory barriers that harmed American exporters and frazzled supply chains.
In March, the Democratic staff of the Joint Economic Committee of Congress issued the report I mentioned at the outset of this essay. “If tariff revenue stays at the level recorded in January 2026 for the rest of the year,” it wrote, “American families would in total pay more than $330 billion in tariff costs in 2026, an average of more than $2,500 per household in tariff costs this year.”
In July of this year, the Tax Foundation, in “Tracking the Impact of the Trump Tariffs & Trade War,” estimated that tax increases would be substantial:
In 2025, the Trump tariffs amounted to an average tax increase of $1,000 per U.S. household. We estimate that the tariffs both announced and imposed, including the Section 122 tariff, Section 232 tariffs, Section 301 tariffs, and Section 338 tariff on Canada, will increase taxes per U.S. household by $900 in 2026.
When Trump announced his Liberation Day tariffs, he declared that “jobs and factories will come roaring back into our country.”
Since then, America has lost manufacturing jobs by the tens of thousands.
The estimates vary — 89,000 as of March by the Center for American Progress (“That is equivalent to the closure of more than 2,800 average-size manufacturing establishments nationwide”); 108,000 jobs as of February by the Democratic minority on the Joint Economic Committee; and 70,000 from the end of 2024 to the end of 2025 by the Cato Institute.
Daron Acemoglu, an M.I.T. economist and Nobel winner, replied by email to my queries, noting that the president’s zero-sum thinking comes much more into focus in three areas:
Trade. He obviously doesn’t understand or care for the economics of trade. It is partly zero-sum thinking, and partly an extension of his domestic agenda whereby controlling trade and tariffs on individual countries and individual sectors gives him a lot of power, both in the abstract and over specific companies and C.E.O.s.
China. His thinking on China has very heavy zero-sum elements. Here you also have to blame Congress and Silicon Valley more generally. The narrative from Silicon Valley around A.G.I. and the tech race with China is all zero-sum. This is false and awful for global institutions and collaboration, which is badly needed right now on things like climate change, pandemics, A.I. and global security.
Soft power. The Trump administration has completely turned its back on soft power, which has been a central foundation of U.S. influence around the world throughout the postwar era. This also reflects zero-sum thinking. Soft power is about influencing constituencies, peoples and politicians around the world so that they do things that are both in their best interest and consistent with U.S. objectives. Hard power is much more zero-sum, which is what Trump understands and values.
Trump does have some support for his tariff policies.
Oren Cass, the founder and chief economist of the think tank American Compass who is also a contributing Times Opinion writer, made his case in an August 2025 interview on “PBS News Hour”:
We made a choice a generation ago that we were going to go all in on free trade. We were going to embrace China. We wanted the cheap stuff, and we knew that there were going to be costs to that, right? Economists would tell you: Well, there will be winners and losers. And what they meant in particular was a lot of the people who had been doing best in our economy were going to be doing even better.
A lot of people who were struggling were going to struggle even more, but we should celebrate it anyway and push ahead because we’re going to get a lot of cheap stuff.
And I think what the American people have rightly realized over the last couple of decades is that’s not a good trade-off. Just getting more cheap stuff, having bigger TVs, does not compensate for an unbalanced economy, an economy that leaves way too many people behind, an economy that has had industry hollowed out, and as a result of that, an economy that doesn’t really support our national security, our resilience.
The disastrous consequences of Trump’s zero-sum approach extend well beyond trade and tariffs. Kimberly Clausing, an economist and tax policy expert at the U.C.L.A. School of Law, writing by email, described the damage in trade and then expanded to other areas:
Zero-sum thinking has been a real plague on Trump administration economic policymaking. The most obvious example is the administration’s trade policies. International trade, much like markets in general, generates enormous benefits for both buyers and sellers. The president has insisted on broad tariff policies that reduce the mutual benefits from trade with nearly every important economy in the world.
Beyond that classic example, immigration policy is another area where the president has harmed both immigrants and the entire U.S. economy, through a failure to recognize the many upsides to immigration for the U.S. economy.
Immigrants are not just workers; they are also entrepreneurs, employers and consumers. They create jobs and innovation. Instead of focusing immigration policy narrowly on issues around border control and public safety, Trump administration policies have discouraged immigration from any source, including very talented graduate students in STEM fields, as just one example.
Then Clausing took the gloves off. Trump’s failure to see the promise of win-win negotiation tactics, she continued, can be seen
in other areas as well, including funding for basic science, funding for adequate tax administration resources, funding for U.S.A.I.D. and attitudes on public health issues.
In order to promote a “win” for ideological groups within the Republican Party, the Trump administration has created, respectively, an America that is less innovative, a tax administration system that functions poorly and rewards tax cheats, a large increase in global human suffering alongside an enormous hit to U.S. soft power, and a less healthy American citizenry.
Trump the policymaker repeatedly does more harm than good. He is trapped in a maelstrom of zero-sum thinking, profound narcissism and an unshakable faith in his instincts. It’s a combination that imposes heavy costs on a vast majority of Americans — and that’s before we get to the rest of the world.
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