BYD increasingly threaten giants like Amazon and Tesla.
Any success in bringing manufacturing back will mostly come through automation instead of high-paying jobs, benefiting major US corporations. Still, decades of cooperation with China means that these businesses remain exposed, with major corporate figures expressing public concern and Elon Musk publicly criticizing Peter Navarro’ s role in the tariff push.
Trump has, in turn, framed tariffs not only as leverage over trading partners but also as a source of revenue to offset other taxes. His 2024 campaign called for cutting the corporate tax rate to 15 %, down from 21 %, already lowered from 35 % during his first term.
However, the promised economic boom was not evident before Covid-19 hit, and his suggestion of replacing personal income tax with tariff revenue is also unlikely to generate enough funds to do so, even in an optimistic scenario.
And while the US needs to expand production for both domestic use and exports, current capacity falls far short. Tariffs might push companies and consumers toward new habits, but blanket protection without government initiatives in infrastructure development, skills training and research and development risks doing more harm than good, and leaves the private sector to act with little guidance.
Compared to Trump’ s unpredictable approach, China and the EU have positioned themselves as stable anchors of the global economy. US calls to coordinate with major economic allies like the EU and Japan to limit dealings with China, including reducing Chinese imports and preventing its companies from establishing themselves, risk falling on deaf ears as tariffs have strained ties.
Global Risks
Reducing access to US consumers also threatens a major pillar of global economic stability. The US accounted for roughly 13 % of global import consumption in 2023, acting as a safety valve for global overproduction by absorbing excess goods.
China, facing a property crisis, high youth unemployment and mounting local government debt, has pledged to“ vigorously boost domestic consumption,” according to the People’ s Daily, to help replace American consumers.
But its $ 300 billion trade surplus with the US exemplifies its reliance and more limited leverage for retaliation. The EU has signaled it will not tolerate a flood of Chinese goods, as it, like the US, increasingly finds itself competing with China in high-end products.
The EU and Canada have similarly raised tariffs on the US. The Trump administration has tested EU unity by courting globalization-skeptic allies like Italy’ s Prime Minister Giorgia Meloni, though tensions are likely to deepen before they ease.
Europe’ s struggle to sustain support for Ukraine against Russia has shown the perils of deindustrialization, a trend the US now seeks to radically reverse ahead of others. And, by targeting allies with tariffs too, the US ensures that any self-inflicted economic pain is matched abroad, making the cost of reshaping trade a shared burden.
Forcing a global trade war— an escalating Canada-China tariff clash in 2025 is one sign— is likely to further weaken China’ s export-led model. As the US signals a reduced role in safeguarding global maritime trade, already strained by disruptions like Houthi attacks in the Red Sea and rising piracy, geopolitical tensions could disrupt other key routes. Without US intervention, free trade will face rising shipping and insurance costs.
Trump frequently changed tactics in his first term, mixing threats with negotiations. If his tariff strategy falters, voices like Kent Lassman’ s in Project 2025, calling for a return to free trade, may gain traction.
But Trump has been warning of trade imbalances since the 1980s, when Japan and West Germany were his main targets. He seems determined to make reversing it central to his legacy, this time focusing on China.
Scrapping the old, in his view, unreformable system and embracing whatever follows is based on the belief that the US is best positioned to shape the new system. The question now is which countries will support that shift or be forced to.
Whether a complete globalization teardown occurs or not, he appears ready to push as hard as possible within constraints. As evidenced by much of MAGA’ s merchandise still being made in China, dismantling Beijing’ s advantages in global trade will not be easy.
80 The Trial Lawyer