Like a drug addict, Trump’s addiction to tariffs will do more harm than good for the U.S. economy.

Donald Trump’s return to the White House in January raises fresh concerns about reviving his protectionist tariff policies. These measures have long been criticized for their destabilizing effects on the global trading system and for being inconsistent with U.S. commitments under the World Trade Organization (WTO). 

The policies risk exacerbating conflicts between the U.S. and its trade partners, particularly China, which previously lodged a formal complaint with the WTO. Other major economies, including the European Union, Canada, and Japan, have suffered significant repercussions from these policies.

WTO agreements such as the 1994 General Agreement on Tariffs and Trade (GATT), the Agreement on Subsidies and Countervailing Measures (SCM), and the Dispute Settlement Understanding (DSU) explicitly prohibit the kind of unilateral protectionist measures Trump has favored. These agreements emphasize the importance of free trade and discourage tariffs aimed at shielding domestic industries or reducing imports. Such measures undermine the WTO’s core principles, fueling uncertainty in international trade.

A defining consequence of Trump’s tariff policies during his first term was the intensification of the trade war between the U.S. and China. By 2019, the Trump administration imposed import tariffs on Chinese goods valued at $370 billion, with rates as high as 25% on some products. China responded with tariffs on $110 billion worth of U.S. goods. The resulting economic fallout was stark, with global trade volumes shrinking by an estimated 0.3%.

Domestically, the policy fueled inflationary pressures, hitting U.S. consumers particularly hard. Prices for essentials like clothing, footwear, and electronics soared, disproportionately affecting middle- and lower-income households. Furthermore, the tariff policies disrupted supply chains, hampered the agricultural sector, and curbed U.S. exports.

While President Biden continued certain tariffs implemented during Trump’s tenure, his administration adopted a less aggressive, more diplomatic approach. Biden sought to reduce trade tensions by engaging multilaterally through international organizations like the WTO. Yet, despite his cautious recalibration, many tariffs remained in place, particularly those targeting industries deemed critical to national security or economic independence, such as Chinese technology firms.

Trump’s re-election raises the specter of a renewed tariff onslaught. Guided by his ultra-nationalist “America First” ideology, he may double down on measures to prioritize U.S. economic interests, potentially straining relations with global partners. His previous tariffs targeting technological products, such as Huawei telecommunications equipment and 5G-related hardware, exemplify his focus on leveraging economic policies for national security. This protectionist stance could intensify if trade deficit data reveal growing reliance on imports from key competitors.

However, the negative impacts of Trump’s earlier tariffs offer critical lessons. Before re-adopting such policies, policymakers would do well to weigh the consequences, including inflationary pressures and supply chain disruptions. The possibility of continuing the Phase I Trade Agreement between the U.S. and China provides a promising alternative.

Initially negotiated during Trump’s first term, the agreement aimed to reduce some tariffs, with the U.S. cutting rates from 15% to 7.5% on certain goods. In exchange, China committed to increasing its purchases of U.S. products by $200 billion over two years compared to 2017. Although the deal did not address deeper structural trade issues, it laid the groundwork for a more constructive relationship between the two economic superpowers.

From a Kantian moral framework, the Phase I agreement aligns with principles of mutual benefit and cooperation, offering economic advantages for both sides. For the U.S., the agreement could boost exports, reduce the trade deficit, and ease tensions that undermine broader international stability. Moreover, the deal includes mechanisms for resolving disputes, providing a pathway for de-escalating trade conflicts without resorting to additional tariffs or prolonged litigation.

Another viable option for Trump’s second term is to foster greater U.S. participation in multilateral trade agreements, such as the Regional Comprehensive Economic Partnership (RCEP) or the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). By joining these frameworks, the U.S. could expand market access across the Asia-Pacific region and reduce its reliance on protectionist policies that often lead to trade wars and international tensions. These agreements represent an opportunity for collaborative economic growth, allowing the U.S. to assert leadership in shaping global trade norms.

Ultimately, the choice between unilateral tariffs and cooperative trade policies will define the legacy of Trump’s second presidency. While tariffs may provide short-term domestic gains, their long-term consequences—ranging from higher consumer costs to strained diplomatic ties—are hard to ignore. By reconsidering his administration’s approach to international trade, Trump could embrace policies that promote economic stability and strengthen America’s role in an interconnected global economy.