Donald Trump’s tariff tirade has needlessly set America back. Allies and rivals alike are seizing the opportunity.
Photo Credit: Anna Moneymaker for Getty Images
Trump, Tariffs, & Losing
Quick Bits
The height of incoherence in Trump’s trade tirade is the favorable position it bestows to China.
Though Trump claimed he was ignoring the markets’ reaction to his policies, he was definitely clued in, and no doubt feeling out of his depth as advisors like Bessent worked to make him aware of the spiraling situation.
That the lead player may no longer like the rules of the game evokes the image of a petulant child upset at a board game and refusing to play anymore (or worse, flipping the table).
“What the U.S. is doing now is not reform, it is rejecting the very system it created.”
China has keenly sensed that the real outcome and opportunity of Trump’s overture on trade is harder to measure but equally if not more important – credibility.
What’s perhaps most exceptional about this new era in geopolitics is that most countries see China, with its commitments to mitigating climate change and supporting free trade, as a more reliable partner for the future than the United States.
Hanlon’s Razor - Never attribute to malice that which is adequately explained by stupidity.
Where were you when the United States lost the 21st century?
It may be hard for historians to pinpoint the precise moment when America ceded its decades-long hegemony in favor of a navel-gazing obsession with the evils of free trade, if only because President Trump has provided so many moments to choose from. What took place in the Rose Garden on April 2nd, 2025, however, is a promising candidate. While the world continues to shake from the waves of Trump’s “reciprocal” tariff announcement, the ripples are likely to be felt for decades to come.
As a student of economics and world history, the tariffs make me angry at our leadership, sympathetic towards our allies, and worried about our future. There is one absolute truth that should govern your moral framing of Trump’s actions – in the era of free trade, no country has prospered more than the United States, often at the expense of other nations. As Trump proclaimed the United States was getting “ripped off” and justified it with a bogus mathematical formula (conveniently excluding services from the discussion), I didn’t know whether to feel more insulted or appalled.
As Trump continues to beat the drum of grievance politics, however, the world is rallying around free trade and beginning to imagine a future without American leadership. It's a tragic turn—not least because America’s prosperity has long depended on the contributions of immigrants and allied nations, who helped build a system rooted in trade, cooperation, and shared values.
The height of incoherence in Trump’s trade tirade is the favorable position it bestows to China. In allowing emotional policy making fueled by resentment to take the lead over rational strategic calculation, this administration has scored a spectacular own goal. Levying tariffs on the entire world has made the international climate far friendlier for Chinese diplomats, who astutely recognize this is an opportunity fill the global leadership void. Worse still, the United States has miscalculated the leverage it has in a trade war with China.
Trump’s grievance-led tariffs are not only strategically shortsighted, but morally backward, historically incoherent, and geopolitically disastrous. They reveal a nation turning inward just as the world moves on—handing China the opportunity of the millennium.
“There is one absolute truth that should govern your moral framing of Trump’s actions – in the era of free trade, no country has prospered more than the United States, often at the expense of other nations. ”
Trump’s Tariff Tactics - Dead on Arrival
It says much that Trump is already in the midst of backtracking on many of his tariff promises. In the roil of the panic in the week after his tariff announcement, Trump issued a 90-day pause on almost all of his original tariff targets, placating spooked investors. On Saturday, April 12, Trump announced that tariffs on electronics such as laptops and smartphones would be temporarily paused as well, the first sign that he may be forced into softening his position towards China.
I’ve been obsessed with the picture of Scott Bessent hovering over Trump (left) because I think it brilliantly depicts the childishness of Trump’s tariff rollout and hearkens back to the “Adults in the Room” energy of Trump’s first term. Though Trump claimed he was ignoring the markets’ reaction to his policies, he was definitely clued in, and no doubt feeling out of his depth as advisors like Bessent worked to make him aware of the spiraling situation.
One of the sadder pieces I read this week was about automotive workers in Michigan who stand to suffer the most from these tariffs due to the intense competitive pressures that tariffs will put on American car companies. As Stellantis was in the midst of furloughing 900 workers in Michigan and Indiana, Trump supporters were interviewed parroting talking points from the administration that they were willing to suffer the short-term pain for the long-term gain.
Meanwhile, economists and executives alike are sounding the alarms on Trump’s nostalgia-fueled aims, noting quite contrary to the beliefs of MI voters that rather than bringing an era of prosperity, these tariffs will make all Americans poorer. One irony, as Tej Parikh pointed out in the Financial Times, is that few Americans actually even want to work in the manufacturing industry.
The grievance fueling voters and motivating Trump is blinding them both to economic realities. Reshoring manufacturing to the United States is not realistic without radical actions that would make all Americans poorer – such as raising prices on many consumer goods, putting millions of Americans in lower paying jobs, and spending hundreds of billions and many years in relocating supply chains from Asia to America. Not only is this not a serious proposition, but it’s also not a world that Americans really want, and the market reactions this past week were the first indication of that reality.
Bully Pulpit, Emphasis on Bully
If it were simply a case of bad economics, one could imagine this kerfuffle over tariffs eventually blowing over, albeit with some necessary capitulating by the United States. However, Trump’s tariff proclamation, loudly and proudly denoted as “liberation day”, was not a bolt from the blue, but rather built upon an ideological framework whose principles put the United States at odds with the global community.
By invoking words and phrases such as “rip-off”, “unfair”, and “nobody is getting of the hook”, this administration has attempted but failed to make the case that America is in the moral right to impose these penalties. Even as Trump negotiates the tariffs with Japan today, he recites tired talking points of the US having to defend Japan without getting anything in return.
The international community is caught somewhere between rolling their eyes and feeling existentially offended. Trump and Bessent may not like the system of trade that exists today, but there is no doubt that it was built by the United States in support of its own interests. That the lead player may no longer like the rules of the game evokes the image of a petulant child upset at a board game and refusing to play anymore (or worse, flipping the table).
Pictured: The Bretton Woods Conference, where the United States imposed a new financial order
In thinking to the future, countries want to build stable frameworks with fellow nations that share their values and desire to build prosperity. In imposing tariffs in such a selfish manner, the United States is doomed to fail, imparting the message to the world that what is a gain for you is a loss for us. Who on Earth would want to negotiate under that premise?
As one of my favorite writers, Janan Ganesh, writes in the Financial Times:
“For the first time since the crash of 2008, globalisation has the high ground. It is those striving to undo it who are on the moral and intellectual defensive. Protectionism has turned out to be something of a fair-weather cause: popular as long as no one has to make a material sacrifice”
A Victory for America’s Legacy, A Defeat for America’s Future
If Trump’s tariffs succeeded in startling allies and rivals alike to his seriousness and selfishness, they fell flat as a coherent vision for how to lead trade into the future. International condemnation was strong across the globe, but I found the speech from Singapore’s Prime Minister Lawrence Wong to be especially poignant and well-spoken:
As he eloquently states, “What the U.S. is doing now is not reform, it is rejecting the very system it created.” For Americans steeped in the current political climate, this statement shouldn’t be inherently surprising; after all, Trump built his campaigns and his base by blaming globalization and everything and everyone associated with it.
To the rest of the world, however, the rejection of free trade principles is an existential crisis that threatens their future prosperity. The economic “miracles” of the past half-century have been the China’s, Singapore’s, and South Korea’s of the world who have followed America’s ideological lead on economics and trade and have reaped the benefits.
In the immediate aftermath of the tariff announcement, world leaders distinctly unaligned from Trump’s world view began to plot their response with an eye towards maintaining the advantages of free trade where possible. One of those prominent figures was the President of the European Union, Ursula von der Leyen. As the New York Times reported earlier this week:
“Europe has spent the time since Mr. Trump’s re-election working to strike or improve trade ties with various partners. Officials have been in talks with Mexico, India, South Korea, South Africa and Central Asia, to name a few. The E.U. announced just Thursday that it would begin free trade discussions with the United Arab Emirates.”
One of the most interesting of these overtures has been to Canada, which the Trump administration has mercilessly mocked and threatened in trade and geopolitics, commonly referring to our long-time ally in threatening implication as the “51st state”. (Good luck with that)
Yet to see world leaders from Europe, North America, the Middle East, and Asia all come to the defense of free trade would put a wide smile on the face of American conservative luminaries such as Milton Friedman.
If countries have learned lessons of America’s past successes, however, they are equally motivated to separate themselves from the dangerous path that Trump aims to put America on. This is a strategic failure for the United States. No one country can succeed alone. The more the United States seeks to selfishly enrich itself at the expense of its allies, the more our soon-to-be-former allies will work to create a “coalition of the willing” on issues of trade.
China Rising - “Liberation Day” as a Pivot Point in History
With a little distance for reflection upon my graduate school experience, I can confidently say that the class that best prepared me for the future was China’s Political Economy taught by Doctor Ling Chen. The class charts China’s economic rise between the 1960s and today by analyzing the lessons that Chinese Communist Party policymakers learned from free market experimentation while simultaneously working to maintain political control, something the Soviet Union famously failed to do.
For starters, China was not caught off guard by Trump’s tariff tirade, regardless of how it may appear in the headlines. Not only did China have the experience of the trade spat in Trump’s first term, but writing in 2007, China Specialist and UCSD Professor Susan Shirk noted that, “Chinese officials are growing increasingly nervous about the risk of a protectionist backlash in the United States. They recognize that the trade gap has grown to politically intolerable proportions.”
Though much emphasis has been placed on numerical trade balances and tariff percentages, China has keenly sensed that the real outcome and opportunity of Trump’s overture on trade is harder to measure but equally if not more important – credibility. Writing in the Financial Times, economics commentator Martin Wolf notes:
China, unlike the United States at present, is building towards a sustainable future and seeking international partners to do so. It is investing significantly in key technologies and capabilities, both as a matter of national security and economic growth (see chart below). What’s perhaps most exceptional about this new era in geopolitics is that most countries see China, with its commitments to mitigating climate change and supporting free trade, as a more reliable partner for the future than the United States.
Decades of foreign policy leaders and American presidents have worked to keep China’s growth and influence in check. That they have failed to do so likely speaks to America’s over-estimated sense of self-importance and underestimation of China’s industriousness and determination to build a better future for their citizens. Whatever you may think of those historical attempts by the United States to undermine Chinese influence, no person has done more damage to America’s global influence relative to China than Donald Trump. Given the current state of American incoherence, perhaps that is for the best.
“Third, they [China] recognise that what is happening to the US has clear upsides for their own country. It has dawned on just about everybody by now that Trump’s signature is worthless. A man who is trying to demolish the Canadian economy is not going to be a reliable friend to anybody else. So, the alliances the US will need to balance China in its own neighbourhood or, for that matter, anywhere else are likely to be very fragile. This applies even to Japan and South Korea, let alone other neighbours. In this environment, China, the Asia-Pacific’s principal trading power, as well as a rapidly rising military power, is bound to dominate not just the region, but well beyond that. Even Europe, concerned about Russia and so openly abandoned by the US, will seek a friendlier relationship with China. Trump’s “America First” is bound to mean America alone”
A Strange New World
The importance of this moment is not that its maker or its ideology will be permanent – indeed Republicans will have trouble justifying the economic carnage to voters in 2026 and 2028 – it’s that such drastic rhetoric, selfish and unprincipled treatment of the global community, and anti-intellectual policy will set all Americans back for decades to come, not matter who or what comes next.
This is the real tragedy of the past week, and one that may only become clearer to a segment of Americans over time as the false promises of President Trump fail to materialize in a world that is already working to move past American hegemony.
Amidst loyalist hires in key positions of governance, inane tariffs, and talks of a third term, I’ve been growing increasingly nervous that Trump’s intentions for America are more nefarious than I imagined. However, I was recently reminded of an important precept recently that has for the moment reframed my thinking, Hanlon’s Razor - Never attribute to malice that which is adequately explained by stupidity.
As the dust settles on the opening salvo of tariffs, I can’t help but feel that any initial anger or fear at the United States is quickly being replaced by pity in some corners at our feckless leadership, and giddiness in other corners as we destroy our credibility. Here’s another principle to leave you with that China is already executing to perfection – never interrupt your enemy when he is making a mistake.