Trump’s tariff threats go beyond ‘trade agreement’ to advance American interests: expert
President-elect Trump has announced his plans to impose a 25% across-the-board tariff on all imports from Canada and Mexico, effective his first day in office. This move is seen as a diplomatic one that draws on Trump’s “war chest” to leverage U.S. interests, according to experts.
Tariffs are essentially taxes that governments place on goods being imported or exported. They can raise the cost of imported products, making local products more attractive to buy. Andrew Hale, a senior policy analyst at the Heritage Foundation, believes that Trump will continue to use tariffs effectively, even in areas that are not directly related to trade. He points out that Trump has previously used tariffs not only to address trade imbalances but also issues like border security and drug trafficking.
Hale emphasizes that Trump has consistently applied tariffs in a strategic manner, using them as tools of diplomacy to further his “America First” policies. He believes that Trump’s proposed tariffs on Mexico and Canada could be challenged under the USMCA, but he doubts it will come to that as these measures have proven effective in achieving U.S. goals in the past.
During his first term, Trump renegotiated NAFTA, replacing it with the USMCA, which aimed to modernize and address issues in the original agreement. Trump’s success in using tariffs during the renegotiation with Canada and Mexico demonstrates their power as a diplomatic tool in addressing trade imbalances and other issues.
While Trump’s tariffs aim to boost U.S. manufacturing, experts warn they could disrupt supply chains, increase costs for businesses reliant on foreign goods, and potentially lead to retaliatory tariffs from trading partners, impacting American exporters. Liberal Gov. Gavin Newsom of California has criticized Trump’s proposal, calling it “one of the biggest tax increases in U.S. history.”
Former Vice President Mike Pence has expressed support for Trump’s tariffs but emphasized the importance of a delicate approach to balance the country’s relationship with Beijing. Pence hopes that the proposed tariffs will bring China back to the negotiating table and ultimately benefit both countries.
In a recent conversation with Canadian Prime Minister Justin Trudeau, Trump suggested that if a tariff for failing to address trade and immigration issues would harm Canada’s economy, maybe it should become the 51st state. Trump highlighted the U.S. trade deficit with Canada, estimated to be over $100 billion.
Overall, Trump’s use of tariffs as a diplomatic tool to advance U.S. interests is expected to continue, with a focus on addressing various issues beyond trade imbalances. The impact of these tariffs on the global economy remains to be seen, but their strategic implementation could shape U.S. foreign policy in the coming years.
