The Role of Tariffs in Trade Policy

Tariffs have been a central focus of President Trump's trade policy, which he argues are necessary for creating fairness in trade. He believes that the U.S. needs tariffs to counteract the duties imposed by other countries, aiming to reduce the trade deficit and boost domestic manufacturing. The analysis reveals that past uses of tariffs show mixed results, with some protection of jobs in specific industries, but often failing to revitalize sectors that are no longer globally competitive. For example, while the U.S. imposes high tariffs on certain goods like trucks, its overall tariffs are lower than those of major trading partners like the European Union.