Thoughts on Trump’s Tariff Strategy and the U.S.-China Trade War

As I reflect on the recent announcement by former U.S. President Donald Trump, imposing a bold 104% tariff on Chinese imports, I can't help but feel both a sense of intrigue and concern. This move has undoubtedly sent shockwaves across the global economy, and as we step further into 2025, the ripple effects are being felt everywhere—from the stock markets to the everyday consumer. But is this truly a calculated strategy that will benefit the American people, or are we witnessing a high-stakes gamble that could have unintended, far-reaching consequences?

Let me walk you through why I think this tariff strategy, while ambitious and bold, raises serious questions—especially when viewed through the lens of long-term economic stability and geopolitical relationships.

The Logic Behind the 104% Trump Tariff Strategy

At first glance, it’s easy to see the rationale behind Trump’s move. He’s framing this as a necessary step to address what he calls an unfair trading relationship between the U.S. and China. For years, China has maintained a significant trade surplus with the U.S., meaning they export far more to the U.S. than we send in return. To many, especially Trump’s base, this feels like an economic imbalance that needs to be corrected. In his mind, imposing a 104% tariff on Chinese imports will push China to the negotiating table and force them to reduce their trade surplus.

I get the sentiment. The U.S. has long struggled with trade imbalances, and many Americans feel the brunt of those imbalances, particularly in manufacturing sectors that have seen jobs move overseas. So, in a sense, this tariff is an attempt to level the playing field and bring jobs back to the U.S. It's a powerful message of "America First," which resonates with voters who feel that trade policies over the years have failed to protect their livelihoods.

But as with any drastic economic policy, there are significant drawbacks that must be considered.

The Hidden Costs for American Consumers and Businesses

Let’s not sugarcoat it: there’s a good chance that, in the short term, American consumers are going to feel the pinch. We all rely on affordable goods—whether it's the tech we use, the clothes we wear, or even the basic materials that go into making the products we use every day. By raising tariffs on Chinese imports, the price of these goods will undoubtedly rise. And guess who’s going to foot the bill for that? It won’t be China, at least not directly—it will be the everyday American consumer.

You might think that businesses will just absorb the costs, but that’s not the reality. Small businesses, in particular, will struggle the most. Unlike large corporations that can weather the storm with deep pockets, small business owners don’t have the luxury of absorbing higher prices. They might have to pass those price hikes onto their customers or cut corners in production. This could ultimately lead to layoffs, closures, and the stalling of economic growth in communities that can least afford it.

Think about it—retailers are already warning us that the price of everything from electronics to basic household products could increase significantly. And for working-class Americans, already stretched thin with rising costs of living, this could be the breaking point. The very people Trump claims to be helping might actually bear the brunt of his tariffs.

A Global Game of Chicken: Risks to Global Supply Chains and Allies

Now, let’s zoom out for a moment. This isn’t just a U.S.-China issue—it’s a global issue. The interconnectedness of the world economy is something that often gets overlooked, but it’s crucial. The U.S. and China don’t operate in isolation. They are part of a much broader global supply chain that supports businesses, consumers, and economies worldwide.

The U.S.-China trade war has already had significant ripple effects across the globe. Countries like Canada, Mexico, and members of the European Union are seeing disruptions in their own supply chains because of the trade tensions between the two largest economies in the world. Even if they’re not directly involved in the conflict, they still feel the economic pressure.

Take Canada, for example. It relies heavily on trade with the U.S., but it’s also affected by the global demand for Chinese goods. If American businesses start sourcing materials from countries other than China, it will disrupt not just China’s economy, but the economies of those nations that are in the trade chain.

And then there’s the retaliatory tariffs from China. It’s no secret that China has responded in kind, imposing tariffs on American goods. We’ve already seen how these actions have hit industries like agriculture hard—U.S. farmers are being punished by Chinese tariffs on their products, which is making life even harder for them. In fact, this entire strategy risks creating a downward spiral where no one truly wins.

The Longer-Term Geopolitical Impact: A New World Order?

If we take a step back, this tariff strategy has bigger implications than just trade. There’s a geopolitical dimension that I believe we need to seriously consider. With each passing day, the world seems to be becoming more polarized—not just politically, but economically as well. The U.S. and China are no longer simply two countries in a competitive economic relationship; they are increasingly becoming the leaders of two opposing economic blocs.

China has been quick to position itself as the defender of free trade, and in many ways, it is capitalizing on the current global uncertainty to expand its influence. The U.S., on the other hand, is retreating from its historically more globalist approach, turning inward and adopting an “America First” stance. The result? We could very well be entering an era of economic decoupling, where countries align themselves with either the U.S. or China based on their economic priorities.

If this trend continues, we could see a world divided into two major economic spheres, each with its own set of trade rules, tariffs, and international policies. This could severely affect multilateralism—the idea that trade should be conducted on equal terms across borders, without unfair restrictions. We might find ourselves in a fragmented global economy, where countries must choose sides, and smaller nations get caught in the crossfire.

Does Protectionism Really Work?

The heart of this matter is a simple question: Does protectionism really work? It’s an age-old economic debate. Many economists argue that free trade benefits everyone in the long run by allowing countries to specialize in what they do best and exchanging goods on an open market. Protectionism, on the other hand, can distort markets, raise prices, and disrupt the very supply chains that make the global economy so efficient.

While Trump may believe that tariffs will bring jobs back to the U.S., there is a strong argument that the very nature of global trade means that this is a temporary solution at best. Tariffs don’t create jobs—they simply redirect resources in ways that might not be sustainable. If the costs of doing business rise in the U.S., companies may choose to move their production elsewhere or even rely on automation to offset the rising costs of labor. The end result could be more expensive goods and fewer job opportunities—not more jobs, as Trump seems to promise.

My Final Thoughts

So where do I stand? Well, I’ll be honest—I think Trump’s tariff strategy is a high-risk gamble that could do more harm than good. While I understand the frustration with trade imbalances and the desire to protect American jobs, I don’t believe tariffs are the right solution. Economic protectionism rarely works in the long term, and the unintended consequences of this policy could end up hurting the very people it’s meant to protect.

The U.S.-China trade war is far from over, and as the U.S. escalates its position, the world is watching. It’s possible that China will bend, and the U.S. will extract some concessions, but at what cost? The global economy, already fragile after years of uncertainty and disruption, is not likely to recover quickly from the fallout.

In my opinion, it’s time for a more nuanced approach—one that addresses the real issues of intellectual property theft, unfair trade practices, and market access, but does so in a way that doesn’t trigger a broader economic meltdown. Trade wars rarely end well for anyone, and my fear is that, in the long run, the cost of these tariffs will be far greater than the benefits they bring.