Yves here. Republicans seem not to have gotten the memo that most Americans have worked out that tariffs are hurting them. As G. Elliott Morris wrote:
So by doubling down on tariffs, Trump is doubling down on a policy a supermajority of Americans disapprove of. If “tariff man” were a presidential candidate, he would lose by a larger margin in the Electoral College than Michael Dukakis did in 1988.
Nevertheless, per The Hill:
Trump’s staunchest allies, led by Sen. Bernie Moreno (R-Ohio), are already pushing a plan to move legislation under the special budget reconciliation process that would allow them to raise tariff rates with a simple majority vote to bolster Trump’s embattled trade agenda.
Fortunately there are some saner GOP Senators:
But raising tariff rates with a simple majority instead of the 60 votes usually needed to pass controversial legislation through the Senate is certain to encounter opposition from Sen. Rand Paul (R-Ky.) and other Republican critics of Trump’s global trade war…
Other conservatives, such as Sen. Ted Cruz (R-Texas), say they would be deeply skeptical of any effort to permanently set higher tariff rates…
Sens. Susan Collins (R-Maine) and Lisa Murkowski (R-Alaska) also cheered the Supreme Court decision striking down Trump’s use of emergency powers to impose tariffs.
Before turning to Jomo’s article confirming how tariffs failed to meet any of its promised aims, save raising some revenue (but not enough to have an impact on the deficit), Paul Krugman weighed in as well. From Attack of the Zombie Tariffs
On Liberation Day, Trump justified the tariffs now ruled illegal by telling the American public that our trade deficits were proof that the United States was giving money away to other countries. In his ranting press conference after the Supreme Court decision, he justified his actions by saying,
You take a look at the deficits that we had with some of these countries. It was disgraceful what they got away with for many, many decades.
He has the economics of trade deficits fundamentally wrong. But even aside from that, tariffs aren’t reducing those deficits. In fact, the U.S. trade deficit for all of 2025 was about the same as it was in 2024….
Trump also claimed that his tariffs would revive American manufacturing. In fact, manufacturing employment has declined since Liberation Day. But in that press conference Trump asserted that great things are coming:
You’re going to start to see the results in a year from now when all those factories start that are under construction right now. You see all the construction numbers are so good.
Which numbers does he have in mind? The most recent available data on manufacturing construction show it falling thanks to Trump’s cancellation of Biden’s green energy subsidies:
:
By Jomo Kwame Sundaram, a former economics professor, was United Nations Assistant Secretary-General for Economic Development, and received the Wassily Leontief Prize for Advancing the Frontiers of Economic Thought and Kuhaneetha Bai Kalaicelvan. Originally published at Jomo’s website
President Donald Trump has shaken up the world economy and the rule of international law in the first year of his second term – ostensibly to make America great again, particularly by reviving US manufacturing jobs.
The President has assumed authority from the US Congress to wage war, impose taxes, make treaties, set budgets, regulate federal-state relations and more.
Tariffs
Trump’s 2nd April 2025 Liberation Day tariffs were ostensibly his primary means for generating manufacturing employment.
When the US Supreme Court overruled him on 20 February, he responded by imposing a 10% tariff on all imports, raised to 15% the next day!
The tariffs are a blunt means for reviving US manufacturing jobs. The policy assumes US manufacturing jobs have been mainly lost due to what the White House deems ‘unfair’ competition from cheap imports.
Undoubtedly, US and other transnational corporations have relocated production and generally sourced imports from abroad to reduce import costs.
Imposing tariffs on imported goods to raise their prices is supposed to induce manufacturers to relocate production and jobs to the US.
Higher tariffs were imposed on countries with larger goods trade surpluses with the US. This ignores the services trade balance, generally more favourable to the US.
Tariff threats are now among the Trump administration’s choice weapons or means of economic coercion, including sanctions, to advance and secure its interests.
Revenue
The President claimed trillions of dollars in additional tariff revenue for the Treasury from foreign exporters to fund his massive military spending hike.
But only $264 billion was collected during Trump 2.0’s first year, much higher than before, but still less than 1% of US federal debt.
Tariff revenue peaked in October 2025 at $31.35 billion, well below expectations, months before the Supreme Court decision.
The Kiel Institute for the World Economy found only 4% of tariffs ‘absorbed’ by foreign exporters losing some export earnings. US importers paid the 96% balance of $264 billion in tariffs, weakening the impact of Trump’s business tax cuts.
But Trump’s tariffs have not reduced the US trade deficit, not even for manufactures; this rose to $1 trillion in 2025, as $3.15 trillion in imports exceeded $2.15 trillion in exports.
Although mortgage and loan interest rates have not fallen, inflation continues. The additional tariff revenue would not even have covered the extra military budget Trump has promised.
Congress could have reclaimed its tariff authority, though the current Trump-dominated House of Representatives has not tried.
But with the November midterm elections looming, Forbes reported that the president’s disapproval rating rose to 55% in mid-February, as fewer are confident his administration prioritises curbing inflation.
Financialisation
The US federal debt, around $39 trillion, now requires over $1 trillion in annual debt servicing from the $7 trillion annual budget.
Growing by $1.5-2.0 trillion annually, this unrepayable debt is being ‘rolled over’ for ever-shorter maturities. Hedge funds now hold 27% of US Treasuries, while foreigners, who held half in 2015, now have only 30%.
Treasury bond repurchase – or repo – agreements provide about $4 trillion in financing daily for derivatives speculation. Another financial crash can wipe out many more trillions of often dubious ‘value’.
While the US economy, productive employment, and research funding diminish, various bubbles of unrepayable debt are growing rapidly. Worse, so-called stablecoins and cryptocurrencies have infiltrated financial markets.
Meanwhile, some US mortgage delinquency rates have reached levels worse than in 2007-08. By the end of 2025, financial news agencies were publishing ominous reports of financial vulnerabilities.
Hundreds of billions of promised investments, coerced from other nations using tariff and other threats, will be invested in US financial asset markets but little of this will create manufacturing jobs.
Manufacturing Comeback
Trump has promised to make the US a manufacturing superpower once again, leading the world in technology, computing power and military weaponry. But China leads in many – if not most – areas of recent technological advancement.
Dean Baker found the US labour market weakening over Trump 2.0’s first year. Overall, and manufacturing jobs growth both declined from Biden’s last year.
US manufacturing jobs have long been threatened by transnational corporate globalisation and labour-saving technical change, especially automation.
US policy in recent decades has left the private sector responsible for ensuring US industrial technology leadership and progress. Meanwhile, problems, such as poor infrastructure, remain unaddressed.
Trump’s tariffs may also inadvertently reduce US jobs. Many industrial processes require imported parts, with the tariffs proving disruptive.
Trump’s policies have not created enough manufacturing jobs. The president fired his Labor Department’s statistics head in mid-2025 for not reporting enough job growth.
Nonetheless, it reported only 584,000 net new jobs for all of 2025, compared to 1.6 million in 2024, for the US labour force of 165 million!
The Wall Street Journal noted, “The manufacturing boom President Trump promised … is going in reverse”.
The Trump administration could still use the Supreme Court’s ruling to change its strategy to make America great again by drawing better lessons from US economic history and adopting a more pragmatic approach. But so far, it seems unlikely to do so.
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Let’s hope these evildoers schemes fail. Just my opinion, but I don’t see anything making it out of the House. “Milk carton” Mike Johnson (Have you seen this missing child?) has even indicated as such:
https://www.politico.com/live-updates/2026/02/23/congress/mike-johnson-congress-unlikely-to-find-consensus-to-codify-trumps-tariffs-00793462
Johnson knows he’s down to only one vote he can afford to lose, and my scorecard for refuseniks is:
1. Massie
2. Don Bacon (retiring, on the record against tariffs)
Then there are the MAGA ladies, Boebert, Mace, and Paulina Luna who are furious with Trump over the Epstein files.
Not gonna happen! [Dana Carvey voice]
From various coversations, I found a nostalgia on the right, including the libertarian right, for the days before income taxes where the federal government was funded by tariffs. The modern twist on this is the desire to shift to consumption taxes while lowering taxes on income, capital gain, etc.
Of course, the Republicans aren’t going to openly campaign on that, except to the donor class. And Democratic leadership are downplaying more progressive taxation, also due to the donor class.
I did not see mention in the post of how the Trump tariffs have adversely affected small and medium scale businesses. My understanding is that the Trump tariffs have been detrimental to small and medium scale businesses — and I believe the tariffs have not been especially beneficial to large enterprises — other than their tendency to eliminate competition from smaller enterprises. We are inundated with, even drowned in Trump’s intents for his tariffs, but are those the ‘real’ intents behind the tariffs? The tariffs appear, to me, to be intended to achieve other more unsavory and occulted goals.
We have mentioned that repeatedly before and have even mentioned how the press usually skips over that issue.
Both Krugman and Jomo are economists. They tend to look at macro issues and also may not realize how many manufacturers are on the smaller end of the size spectrum.
Do any of the Administration Insiders know how to trade ahead of specific tariffs slightly ahead of the tariff’s announcement to the public? Do highly placed Friends of the Administration Insiders know how to do that?
Have trades just before tariff announcement been studied to see if any certain traders have been clairvoyant again and again and again?
I sometimes wonder whether Covid 19 is making this a stupider timeline than it would have been otherwise?.
Politicians have to press the flesh and acknowledging how serious a danger Covid is would be a career killer, as would taking a simple precaution like wearing an N95 mask.
Maybe a groundbreaking young politician wannabe could try starting out his/her career by wearing an N95 mask everywhere and everywhen.
When asked about it, he/she could say ” ManBearPig is real”. That would get the South Park vote.