On Feb. 1, 2025, President Trump followed through on a campaign promise by imposing tariffs on imported goods from Canada, China, and Mexico. The tariffs have been postponed while the countries negotiate. The tariffs for goods imported from China are 10%, while those from Mexico and Canada are 25%. President Trump promised his tariffs would lead to a “Golden Age of America,” but they may do more harm than good.
A tariff is a tax on the purchase of a product originating from an importing country. For example, a company that imports foreign parts from Canada to manufacture copy machines in Pasadena would have to pay a 25% tax on the foreign parts to the U.S. government. President Trump has argued that tariffs will generate needed revenue for the U.S. economy. However, critics argue that the U.S. consumer will ultimately pay the cost of the tariffs.
Basic economic principles suggest that importing companies will pass some or all of the cost of the tariffs to American consumers by raising the cost of the goods they sell. This has already caused panic among consumers who rushed to their local stores to buy eggs, fruit, cocoa, and other items. Increasing prices could lead to inflation or reduced demand for goods. A Pasadena-based company might sell fewer copy machines and order fewer parts from the Canadian parts supplier, causing the government to collect less money in tariffs.
Some proponents of tariffs, including fellow students, argue that America can make the items imported from Mexico, Canada, and China here, to avoid the harsh tariffs and increase in prices. People may also argue that tariffs will increase employment by causing more manufacturing to occur in the United States.
Christian Garcia ‘28 said, “In my opinion, tariffs are good for the economy because they would encourage domestic growth by almost eliminating foreign competition.”
These positions are overly optimistic. Some materials needed for products cannot be grown, produced, or harvested in America. America does not have everything it needs to be self-sustaining. In other cases, it may take too long to begin building parts in the U.S., leading to product shortages and inflation. Like many other Americans, some students are torn between the risk of inflation and the possibility of more and better jobs at home.
Rocco Caruso ‘28 said, “I think if carried out correctly, they will be highly successful. But if done too aggressively, it can lead to other countries being less likely to work with us.”
Trump’s tariff policy seems to be broad and aggressive. Head of the Social Sciences department and speech and debate coach James Zucker ‘91 said, “I have an unfavorable view, because if Trump were to do more strategic tariffs, then we might have more of a chance for economic success. Sometimes people will say, ‘He is just doing this to be blustery and to get them to bend to his political will,’ but if that is what he is doing, then it will only work for so long.”
Other countries will eventually see through Trump’s attempts to use threatened tariffs as a political tool. When countries call his bluff, the United States could risk being iced out of economic alliances.
Relying on evidence from President Trump’s first term, we can predict that current tariffs will not improve American jobs. In 2018, Trump imposed 25% tariffs on imported steel, claiming it would protect U.S. steel producers. The tariff did not increase employment among steel workers. By 2020, total employment in the U.S. steel sector was 80,000, lower than the 84,000 workers before the tariffs were imposed.
The jury is out on how this year’s tariffs will affect U.S. employment, as well as the economies of Mexico, Canada, and China. These tariffs will most likely negatively affect the U.S. economy, but only time will tell if these will have more positive or negative effects.