Trump’s Tariff Tango: An Englishman’s Perspective

By JOSH BOAK

WASHINGTON (AP) — In what appears to be a bold gamble, President Trump is once again utilizing his favourite tool: tariffs. His previous attempt sent financial markets into a frenzy, left consumer confidence shattered, and caused a dip in his popularity. However, he seems to believe this round will play out differently.

Economic Bet or Blunder?

This new wave of tariffs hinges on Trump’s conviction that taxing imports will bolster U.S. factory jobs and economic growth. He dismissed the efforts of past presidents, accusing them of being “stupid” for not employing tariffs. Negotiating trade deals, he insists, is simply “too time-consuming.”

On Tuesday, Trump proudly claimed that sending letters, detailing these tariffs, is far more effective. “It’s a better way,” he said, noting that these letters are straightforward. Just numbers like 25% or 35%, and even some as high as 60% to 70%.

Letters and Lists

Interestingly, Trump opted for form letters replete with eccentric capitalizations rather than the grand posterboards showcased during what he dubbed his April 2 “Liberation Day.” This previous method prompted market chaos and led to a 90-day negotiation window.

Yet, as of now, he’s announced tariffs up to 40%, specifically targeting Laos and Myanmar. Japan and South Korea, crucial allies, face tariffs reaching 25%. The method, whilst different, carries the same seismic impact.

Possible Economic Outcomes

Trump’s strategy diverges from typical, prolonged trade agreement processes. His approach presents three potential outcomes. Firstly, he could defy economic opinion, achieving growth. His tariffs could induce a repeat of the “Trump Always Chickens Out” syndrome, or TACO, leading to a retreat before their August 1 commencement. Alternatively, the economy might suffer, harming the very communities that supported his re-election.

Amongst this uncertainty, Senator Ron Wyden, D-Ore., noted these letters extend a “tariff purgatory,” freezing the U.S. economy. CEOs, international leaders, and consumers alike are left in a fog regarding Trump’s true trade strategy.

Market Movements

Remarkably, markets remain relatively unmoved. The S&P 500 appeared flat despite prior Monday declines. Buoyed by a legislative victory in his tax cuts, Trump is confident. Inflation has steadied, contrary to warnings from economists and Democratic critics.

Wendong Zhang from Cornell University observed that floating tariffs as high as 40% to startling 100% might “normalise” these shocks. Others, however, perceive a whirlwind of chaos and lack of genuine policy.

Tariff Revenues: Silver Lining?

Amidst this tariff turmoil, questions regarding revenue abound. Trump claims these tariffs will rectify U.S. trade imbalances. Yet, his targets sometimes include countries with minimal trade ties to America. Interestingly, tariff revenues have more than doubled, totalling $98.2 billion this year.

Treasury Secretary Scott Bessent anticipates revenue could surpass $300 billion by year’s end. He disagreed with the Congressional Budget Office’s $2.8 trillion decadal estimate, considering it low.

The Negotiation Struggle

While several nations, including Japan and South Korea, hope for further dialogue, Trump insists complexity precludes such meetings. Instead, on social media, he confirmed the tariffs commence as scheduled on August 1, without extension.

This unfolding drama continues to capture global attention, leaving much to be desired in clarity and strategy. Nevertheless, Trump stands firm on his approach.

Explore further details on Trump’s tariff policies.

Originally Published: July 8, 2025 at 3:51 PM PDT.