The Long-Term Damage Of Trump’s Tariffs Is Already Being Done
The world is grappling with the reality of an increasingly "predatory America." It could take decades of consistency to rebuild the trust that President Trump has shattered in less than 3 months.
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President Trump inherited an economy that was the envy of the world. It wasn’t perfect, but America objectively had the best post-2020 economic recovery of any country on the planet.
Now, all that progress is being squandered by one man and his delusions of tariff triumph. If your goal was to weaken the U.S. and global economy as quickly as possible, your approach would look a lot like what Trump is doing right now.
Last week, the Trump Administration launched sweeping, belligerent tariffs targeting essentially the entire world, except Russia, North Korea, Cuba, and Belarus. Making matters worse, the tariffs were incompetently administered, based on erroneous reciprocal tariff calculations, and also included islands that are uninhabited by humans.
Since then, U.S. and global markets have lost trillions in value as recession fears rise, companies prepare to hike their prices to cover tariff costs, and as a result, Americans brace for what would be one of the biggest tax increases in history.
Meanwhile, President Trump has been calling this a big success and comparing his tariffs to giving a “patient” surgery. Trump officials have been hitting cable news shows and praising Trump, while literally in a split screen with stock tickers indicating the tanking retirement savings of countless Americans.
There is no rational explanation for these tariffs. They are unnecessary, self-sabotaging, and frankly insane. Nonetheless, there’s a lot of speculation as to why Trump is doing this. Some say Trump sees this as a way to exert power and get businesses and countries to seek exemptions and cozy up to him on an individual basis. Some think he’s genuinely convinced tariffs will revive U.S. manufacturing, in spite of the fact that he’s already costing manufacturing jobs. Some say he’s tanking the economy deliberately for nefarious reasons. Others think he’s simply lost his mind.
Regardless of what’s motivating Trump, or even if he backs off these tariffs entirely, one thing is clear: the bigger picture damage is already done. Trump isn’t simply tanking markets - he’s shattering decades of trust. It could take decades of consistency to rebuild the trust that President Trump has broken in less than 3 months. The idea that the U.S. will have foreign policy or trade continuity across administrations is dead.
President Trump is violating trade deals he negotiated (like the USMCA), jeopardizing 75 years of the post-World War II order by antagonizing NATO allies, abusing executive power domestically, and overall reducing America’s global standing. The U.S. is no longer seen as a good-faith actor in global affairs. These are the ramifications of electing a President Trump with no guardrails. We’re now experiencing Trump unleashed, just as many of us warned would happen.
America’s allies, adversaries, and transactional trading partners alike are beginning to realize they can no longer trust in long-term deals with the U.S. The world now has to have contingency plans for both a Democratic-led U.S. and a Republican-led U.S. Every country will be on edge every four years. If America happens to elect a radical Republican President, they might violate deals they themselves negotiated, depending on their mood.
America hasn’t been perfect, but especially when it came to foreign and trade policy, the world could expect a degree of consistency. In the post-World War II order that America helped shape, the world could reliably expect that American presidents would look out for America’s best interests, and not have egomaniacal episodes and sporadically decide to nuke the global economy.
After Trump lost in 2020, America’s allies could maybe reassure themselves that his 2016 win was a fluke. After 2024, the world is coming to grips with the possibility that this could become the new norm.
America at the moment, because of Donald Trump and his extremist movement, has become unreliable, volatile, and dishonest. When you elect a president who consumes his own disinformation, you are not going to get a reality-based policy approach. Instead, you will get lunacy.
This is why, after winning elections in Germany in February, Friedrich Merz said that his “absolute priority will be to strengthen Europe as quickly as possible so that, step by step, we can really achieve independence from the USA.” If you talk to anyone in Europe, you will find this sentiment being shared widely. And why wouldn’t they feel this way?
The world is acclimating to a “predatory America,” Mark Leonard, director of the European Council on Foreign Relations, told The New York Times:
“The challenge for Europe is how to deal with a predatory America willing to use the vulnerability of allies to extort them, whether it’s a mineral deal in Ukraine or attempts to annex Greenland or the open way Trump is trying to divide Britain from the E.U. with differential trade deals.”
If I’m the leader of a country that was previously deeply tied to America economically and militarily, I would try to build economic and military independence, because Trump is clearly unreliable. While those countries might enjoy support from Democratic presidents, the unpredictable political swings in America are too risky to stake a country’s security on.
If I’m a business leader or investor, why would I build a new factory or invest in a business in the U.S. if its president might wake up one day and decide to torpedo my industry with unaffordable tariffs? Why not move my capital allocations to Asia or Europe?
It’s this fraying of our economic, diplomatic, and military alliances that will have lasting impacts far beyond when Trump leaves the White House. And it’s exactly what foreign adversaries want.
In my article on Trump’s address to Congress last month, I outlined how if you were a foreign adversary and crafted a plan to weaken the U.S. economy, erode America’s global standing, damage Western alliances, gut the federal government into ineffectiveness, and divide the American public, it would look like what the Trump administration is doing.
In JPMorgan Chase CEO Jamie Dimon’s annual letter to shareholders released on Monday, he laid out a similar sentiment, focusing on how fragmenting America’s global alliances is exactly what our foreign adversaries want. Dimon wrote:
“The autocratic nations of the world, and some of the nonaligned nations, would like to see a fragmentation of America’s economic alliances and a weakening of our global economic position, including our status as the world’s most powerful economy, a leader in innovation, and holder of the world’s reserve currency… If the Western world’s military and economic alliances were to fragment, America itself would inevitably weaken over time…
“If given the opportunity, that is exactly what our adversaries want to happen: Tear asunder the extensive military and economic alliances that America and its allies have forged… In the multipolar world that follows, it will be every nation for itself – giving our adversaries the opportunity to set the rules and use military and economic coercion to get what they want.”
What makes all of this worse is how totally unnecessary it is. As I’ve written about repeatedly, America’s economy was strong when Trump took office, in spite of Trump’s lies about it being in shambles. Trump could’ve come into office and coasted on President Biden’s improving economy. Instead, he’s making the worst possible choices at every turn—and proving all of his critics right.
One silver lining to all of the chaos is the fact that Americans are seeing right through this. Parts of the MAGA fever could be breaking, with high-profile Trump supporters like Bill Ackman turning on him over tariffs.
Trump promised blanket tariffs during his campaign. Many of us warned this was coming. Trump's supporters spent months insisting he wouldn't do exactly what he said he would do. Too many business leaders lied to themselves. The markets have been in denial. Well, now we're here.
Business leaders who backed Trump apparently thought he was serious about tax cuts, but the rest was rhetoric. They might get their tax cuts, but they also got foolish tariffs, incompetence, and authoritarian insanity. Trump supporters seem to think they can get Trump à la carte. But you can’t. You get all of him. More and more people are beginning to reckon with that.
Hundreds of thousands, if not millions, demonstrated nationwide in “Hands Off” protests against Trump and Musk’s power grabs over the weekend. Democrats have been winning and over-performing in off-year elections. Polls indicate Trump’s approval could be tanking. Trump’s overreach backfired, just as predicted, and Americans are standing up.
Trump has no more campaigns to run, and he is certainly behaving that way. Congressional Republicans, on the other hand, will have to face voters in 2026. As Trump's approval ratings dip and tariffs ravage the economy, we could see the GOP's self-interest diverge from Trump’s, and new tensions arise.
The GOP-controlled House and Senate, in a heartbeat, could pass a bill to end this with unanimous Democratic support. But they refuse. This is just as much their fault. They’re a coequal branch refusing to check the executive. Pressure and blame need to start being applied to them, because they have just as much agency to change the Trump Administration’s course of action as President Trump himself.
If Republicans fail to act, as I expect they will, they will bear the backlash at the ballot box.
If America does come out the other side of this, and decides to vote in a Democrat in 2028, their mandate will be to not only rebuild America’s economy and federal government broken by Trump, but they’ll also have to rebuild America’s global trust. This will be a far greater project than even President Barack Obama had to undertake after the failures of President W. Bush’s Iraq War and the Great Recession. It will take all hands on deck.
We’ll see how this continues to play out. But one thing is clear: The Trump Administration’s mantra of “short-term pain for long-term gain” is translating to a reality of short-term pain for long-term pain.
Exactly right. Good phrase, “Trump à la carte.” When you get Trumpism, you get the whole, unpalatable plateful,
not one thing or two. People who thought he’d fix everything on Day One won’t be able to figure out why it’s taking so long—“How about never? Is never good for you?” (To quote the New Yorker cartoon)
Thank you as always, Ahmed. I can’t even . . . as the saying goes.