What increased tariffs mean for the economy in 2025
Since his January inauguration, Trump’s White House has taken swift action on tariff policy, fulfilling promises made throughout the 2024 campaign to combat trade deficits, illegal immigration, and drug smuggling. Initially aimed at Mexico, Canada, Colombia, and the European Union, among others, Trump has imposed a flat 10 percent tariff on all imports from China and a 25 percent tariff on all imports of steel and aluminum.
The international community has largely acceded to Trump’s wishes. While the Mexican, Canadian, and Colombian governments have participated in negotiations, the stock market demonstrated volatility as traders aim to combat high prices and focus on spurring the domestic economy.
The administration’s White House Fact Sheet describes the tariffs as a “powerful, proven source of leverage for protecting the national interest. President Trump is using the tools at hand and taking decisive action that puts Americans’ safety and our national security first.”
The administration reinforced their decision, stressing, “President Trump is taking bold action to hold Mexico, Canada, and China accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country.” The tariff leverage worked to the United States’ benefit, as the Colombian government first turned away deportees, but later accepted the plane of illegal immigrants back into the country.
Reactions to the tariffs across campus have been mixed. Freshman Nick DeNatale told the Rover, “President Trump’s tariffs were a necessary step to counter decades of unfair trade practices that hurt American workers and businesses. By imposing tariffs, he forced countries like China to the negotiating table and prioritized U.S. manufacturing and economic sovereignty.”
DeNatale approved of Trump’s prioritization of American economic independence, adding, “While critics argue about short-term costs, the long-term goal was to reduce dependence on foreign supply chains and bring jobs back to America—something no other president had the courage to tackle head-on.”
Duncan resident Hayden Stokes took a more neutral stance on the tariff moves, telling the Rover, “[The tariffs] may cause some short-term harm to the economy but are also useful as a bargaining chip in international relations.”
The Rover interviewed economics professor Forrest Spence, who expressed hesitancy about Trump’s negotiation tactic: “We’ll see. In 2018, when Trump initially started imposing tariffs on, you know, solar panel cells and washing machines and steel and aluminum, and then just a bunch of flat tariffs on Chinese imports, it was like, hey, you know, maybe we can get some concessions out of this from the Chinese government, [but] that never came to pass.”
Another fear that many Americans have expressed is the risk tariffs could present to prices in an inflationary environment. To that point, Spence told the Rover, “You get a one-time shock to inflation. That’s not great. I mean, it’s not terrible. It is bad that consumers have to pay higher prices for particular types of things. You are making us materially poorer through this, but maybe you’re generating revenue. Economists would say that there are better ways to generate tax return revenue than through tariffs.”
Using the example of steel, Spence noted the threat these positions pose to intermediate goods: “When you impose taxes on steel and aluminum, MillerCoors is not happy, right? Boeing’s not happy, Ford’s not happy, because at the end of the day, they need steel in order to produce stuff.”
While Spence conceded that some political leverage may be useful in securing favorable trade conditions for the U.S., he still stressed the importance of resisting a hostile situation, saying, “I am not opposed to trying to make sure that other governments are acting in good faith. And if how you’re going to do that is threatening them with something that’s bad for them, my only hope is that the resolution of that is that the bad thing doesn’t happen and everybody just kind of behaves in a more efficient way.”
Spence continued, “The danger is that you end up in a world where … countries balk and they have retaliatory tariffs and we have tariffs; and you end up in this situation where everybody’s trying to screw everybody, and everybody is poor because of that.”
Kevin Andrews is a sophomore in Keough Hall majoring in political science and economics. When not covering international war, he can be found in Duncan Student Center, wasting his Flex points, probably on Chick-fil-A. He can be reached at kandrew6@nd.edu.
Photo Credit: Wikimedia Commons
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