Trump opening door to more global economic uncertainty

Editor's note: Anthony Moretti, a special commentator for CGTN, is an associate professor at the Department of Communication and Organizational Leadership at Robert Morris University in the U.S. The article reflects the author's opinions and not necessarily those of CGTN.

The evidence is clear: Tariffs are not a sound economic policy. Yet, Donald Trump persists, convinced that implementing them is wise. Perhaps he thinks they will not hurt the American consumer as much as economists warn they will. Perhaps he remains confident tariffs are a great negotiation tactic. Perhaps he doubts they will spread anxiety among international trade partners.

Regardless, Trump is at it again. On Monday, he followed through with another barrage of tariffs, announcing that steel and aluminum imports, no matter the country of origin, will face a 25 percent tariff. The tariffs will kick in on March 12, meaning there is precious little time for a diplomatic solution. Calling his decision "a big deal" because it would "make America rich again," Trump believes heightened tariffs will increase domestic production of steel and aluminum and will, therefore, be good for American workers. However, doubts persist over whether the U.S. will ever return to its past glory with these metals.

If such tariffs are supposed to make America rich again, they will definitely make Americans poor again. Consider this example: The average car price could go up by $2,000, meaning new car purchases, already inching close to $50,000, could easily exceed that amount. Needless to say, auto industry leaders are concerned about how the tariffs will negatively impact supply chains, the delivery of steel and of course, cost.  

Moreover, if such tariffs aim to make America rich again, they will definitely damage multiple nations and America's already tattered image around the world.

The American Iron and Steel Institute recently reported that Canada, Brazil, Mexico, South Korea and Vietnam, in that order, exported the most steel in 2024 to the U.S. Meanwhile, the Aluminum Association noted that last year the U.S. imported almost two-thirds of its aluminum from Canada and then exported approximately $2 billion in aluminum-related products to that country. Trump's decision drew an immediate rebuke from Canada, where suppliers are worried that an onslaught of canceled orders will lead to an oversupply of the metals.

However, the Washington Post argues that China is the real target of the latest tariffs because it exports the most steel around the world and might be dumping steel at prices that U.S. producers cannot meet. No one should be surprised that Trump wants to pin blame where it does not belong. Remember, his voice is the loudest in Washington arguing that China is not a reputable actor on the global stage. People with a deeper appreciation of the global situation know better, but they lack the megaphone that belongs to the president of the United States.

The five countries, excluding China, highlighted above deserve more attention. Canada and South Korea are longstanding American allies, while Brazil, Mexico and Vietnam are home to three of the largest Global South economies. Trump risks drawing the ire of all five nations, not to mention others affected by his plan, with his brashness. There is a legitimate belief that the affected nations and others will gravitate toward China, a nation determined not to use tariffs as a strategy. For instance, keep in mind that last year, China announced zero-tariff treatment for more than three-dozen countries with which it enjoys diplomatic relations, a move designed to boost the economic health of those nations and China. The move was seen as especially helpful to many African nations.

Economists and other experts agree that Trump's tariff wars fly in the face of conventional wisdom. One analyst recently told CNBC, a U.S.-based cable network that focuses on business, that tariffs "are a tax on imported goods," meaning that U.S. businesses and consumers end up paying for them primarily through higher prices. The Peterson Institute for International Economics warned American families that they should expect to fork over $1200 if the previous battery of tariffs Trump has promised are realized. That figure does not include costs associated with this week's sanctions involving Brazil, South Korea and Vietnam.

Projecting the long-term responses to what the president is planning is sure to end up in failure, but the short-term reactions are clear. At the risk of bluntness, it goes like this: "Slap new tariffs on us, and we will slap new ones on you." A second implication: dissatisfaction at the World Trade Organization, which has a standing policy that member nations will not alter any arranged tariffs between each other.

Trump's stubbornness is well known. He has never shown hesitation to do what he wants and when he wants, even if it means he or a member of his staff has to walk back something he has said. A level-headed approach would serve the U.S. and the world well at this point. Higher prices benefit no one. Questions about supply chains harm stock markets and business plans. Doubts about an ally risk adding strain to everything from people-to-people exchanges to military alliances.

Poland's prime minister has said that Trump's use of tariffs is "totally unnecessary and stupid." Nothing more needs to be said.

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