President-elect Donald Trump has ushered the Republican Party back toward its protectionist roots in order to boost the American manufacturing sector and end U.S. reliance on foreign imports. But what has become increasingly clear since Trump’s emergence on the political scene in 2016 is that he views tariffs as far more than just an economic tool.
This fact was on full display late last month as Trump proposed a 25 percent tariff on all imports from Canada and Mexico beginning on day one of his administration. Rather than as just an economic means to protect American industry, Trump proposed the tariff as leverage to force Canada and Mexico to take action to stop the flow of drugs and migrants into the United States.
“This Tariff will remain in effect until such time as Drugs, in particular, Fentanyl, and all Illegal Aliens stop this Invasion of our Country,” Trump wrote on his Truth Social account. “Both Mexico and Canada have the absolute right and power to easily solve this long-simmering problem. We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!”
Trump also threatened an additional 10 percent tariff on products from China, which is a major supplier of chemical precursors used to make deadly fentanyl in Mexico. “Representatives of China told me that they would institute their maximum penalty, that of death, for any drug dealers caught doing this but, unfortunately, they never followed through,” Trump said in an additional post.
The corporate media has predictably devolved into a state of panic over this proposal and the rest of Trump’s tariff agenda, predicting the imminent collapse of the American economy. But those same doomsayers in the press have neglected to report the success of Trump’s first-term tariff agenda and just how unfairly American producers are treated in the global economy.
What Trump astutely recognizes is that Mexico, Canada, and China all rely heavily on exports to the United States – giving the U.S. government significant leverage over those nations through the power to levy import tariffs.
Moreover, Trump’s tariffs have exposed unfair trade and business practices that disadvantage American producers. Ulf Håkansson, a professor of economics with expertise in international trade, told me that for decades prior to Trump’s arrival on the political scene, “Chinese companies have merged with or acquired Mexican and Canadian firms that have taken advantage of the U.S. trade system and its market openness.”
“Unaddressed unfairness demoralizes and even undermines trade,” he added.
One such example of this which has come to light over the course of the Biden-Harris administration is the trade in epoxy resins, chemical substances used in many industrial applications, including adhesives, civil engineering products, coatings, composite materials, electronics, insulating materials, and paints. The production process for everything from commercial jetliners to basketballs uses epoxy resins.
Earlier this year, the Biden administration launched an investigation after several U.S. epoxy resin producers raised concerns about foreign producers receiving substantial subsidies from their governments in order to undercut American companies.
Florian Kohl, the epoxy president for Olin Corporation, one of the largest American producers of epoxy resin, stated that unfairly subsidized imports “significantly hindered” Olin’s “production, sales, and earnings.” Kohl further urged the Biden administration to impose import duties, warning that failure to address the issue could “jeopardize” U.S. producers and threaten “the welfare of their employees and local communities.”
The Biden Department of Commerce’s subsequent investigation revealed that at least five countries, including China, are selling epoxy resin cheaper than U.S. producers only because they receive subsidies. In some cases, the “dumping rate,” or the percentage by which foreign producers were selling a product in the U.S. at a price lower than its normal value, exceeded 300 percent – a clear sign that foreign suppliers are seeking to aggressively capture U.S. market share and destroy U.S. companies.
The Biden administration responded by imposing a 113 percent anti-subsidy tariff on some Chinese producers, but industry leaders like Olin say more action is needed from the incoming Trump administration to fully product U.S. suppliers.
Epoxy resins are hardly the only unfairly subsidized industrial material coming into the United States. Mexico has also engaged in “dumping” of steel across the border, undermining the critical American steel industry and violating the U.S.-Mexico-Canada Agreement (USMCA). In 2023, steel shipments from Mexico were reported to be 134 percent higher than the USMCA baseline for iron and steel products.
An economic analysis from Coalition for a Prosperous America, a think tank that monitors the U.S. manufacturing industry, has found that more than 1 million American jobs are at risk if this surge is not addressed. Professor Håkansson likewise believes that dumping cases “could potentially impact 1 to 5 million American jobs without appropriate barriers.”
There is also compelling evidence that steel products from countries the U.S. has placed high tariffs on, such as China and India, are being funneled through Mexico to circumvent those tariffs.
Trump’s tariff agenda is built on an understanding that tariffs, when implemented strategically, are an “all of the above” solution to not just protecting U.S. workers and companies but also enforcing trade agreements, ensuring national security, and promoting overall economic prosperity. More than just a trade policy, tariffs are a tool for turning Trump’s “America First” agenda into tangible results for the American people in myriad ways.
Ben Solis is the pen name of an international affairs journalist, historian, and researcher.
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