Ignore the Hype. Trump’s Tariff Strategy Isn’t Delivering the Wins It Claims.
The argument that President Trump’s tariff-heavy trade policy is quietly “working” rests on a selective reading of events and a misunderstanding of how trade balances, supply chains, and allied politics function. Yes, foreign leaders publicly criticize U.S. tariffs while privately negotiating adjustments. That is how diplomacy works. But the available evidence does not support the claim that tariffs have fundamentally restructured global trade in America’s favor—or that they have meaningfully strengthened American workers.
Tariffs Have Imposed Real Domestic Costs
The first problem with the “it’s working” thesis is that tariffs are taxes paid largely by Americans. Multiple empirical studies of the 2018–2019 tariff rounds found that the costs were borne primarily by U.S. firms and consumers, not foreign exporters. Economists from Princeton, Columbia, and the Federal Reserve Bank of New York concluded that “the incidence of the tariffs fell entirely on domestic consumers and importers,” with no measurable reduction in foreign exporters’ prices.¹
The nonpartisan Congressional Budget Office estimated that the 2018–2019 tariffs reduced U.S. real GDP and household income, lowering average real household income by hundreds of dollars annually.² Meanwhile, retaliatory tariffs reduced U.S. agricultural exports sharply, requiring tens of billions of dollars in federal aid to farmers to offset losses.³
If a policy requires large domestic subsidies to counteract its side effects, that is not evidence of quiet success. It is evidence of distortion.
Trade Deficits Are Not Simple Scorecards
The claim that trade imbalances prove systemic unfairness is rhetorically powerful but economically misleading. Trade balances reflect macroeconomic factors—particularly savings and investment patterns—not simply tariff barriers. The International Monetary Fund and the Federal Reserve have both emphasized that persistent U.S. trade deficits are closely tied to the dollar’s role as the world’s reserve currency and America’s relatively low savings rate.⁴
Even after the imposition of tariffs, the overall U.S. trade deficit widened in subsequent years. Bilateral deficits shifted among trading partners, but the aggregate imbalance remained substantial. Tariffs altered sourcing patterns—often from China to Vietnam or Mexico—but did not eliminate structural trade gaps.
That suggests the policy has rearranged supply chains more than it has reshaped the global trading order.
Allied Defense Spending Has Broader Drivers
Germany’s increased defense spending is frequently cited as proof that tariff pressure works. But Berlin’s spending surge followed Russia’s full-scale invasion of Ukraine in 2022—an exogenous geopolitical shock that transformed European security priorities. The €100 billion “Zeitenwende” fund announced by Chancellor Olaf Scholz was explicitly framed as a response to Russian aggression, not auto tariffs.⁵
Defense procurement decisions also follow multi-year planning cycles shaped by NATO commitments, industrial policy, and threat perception. Attributing these shifts primarily to tariff threats oversimplifies complex strategic decisions.
Multilateral Systems Delivered Concrete Gains
The postwar trading system was hardly static or naïve. Under the World Trade Organization, the United States won the vast majority of dispute settlement cases it brought against trading partners.⁶ The U.S.-Mexico-Canada Agreement (USMCA), often cited as a triumph of unilateral pressure, preserved much of the structure of NAFTA while introducing negotiated updates—an example of continuity as much as rupture.
Moreover, research from the Peterson Institute for International Economics finds limited evidence that tariffs revived broad U.S. manufacturing employment trends, which are driven more by automation and productivity growth than trade alone.⁷ Manufacturing output rose and fell with macroeconomic cycles, but long-term employment decline predates China’s WTO accession and reflects structural technological change.
Workers Deserve Policy That Works
None of this means the old consensus was flawless. Trade adjustment assistance was often underfunded. Regional dislocation was real. The “China shock,” documented in peer-reviewed research, had severe local labor market effects.⁸
But acknowledging worker harm does not validate tariffs as the optimal solution. Effective worker-centered policy might include wage insurance, skills investment, domestic industrial strategy, infrastructure modernization, and coordinated enforcement of trade rules—not blanket import taxes that raise input costs for American manufacturers.
In fact, many U.S. manufacturers rely on imported intermediate goods. Tariffs on steel and aluminum, for example, increased costs for downstream industries that employ far more workers than primary metal production. Studies found that job gains in protected industries were offset—or exceeded—by job losses in tariff-affected sectors.⁹
Real Reform Requires Strategy, Not Shock
The core question is not whether the previous system was imperfect. It was. The question is whether unpredictability and tariffs are delivering durable structural gains.
Evidence so far suggests a more modest outcome: higher input costs, reshuffled supply chains, continued macro-level trade deficits, and episodic diplomatic friction. That is not a revolution. It is a high-cost renegotiation with ambiguous net results.
The United States absolutely has leverage as the world’s largest consumer market. But leverage is most powerful when deployed predictably and in coordination with allies, not when it alienates partners whose cooperation is essential in areas from export controls to technology standards.
History will judge this era not by rhetorical toughness, but by measurable outcomes: sustained productivity growth, rising real wages, resilient supply chains, and stable alliances. On those metrics, the verdict remains very much unsettled.
Outrage is not analysis. But neither is selective accounting.
Sources
Amiti, Redding & Weinstein (2019), Federal Reserve Bank of New York / Princeton / Columbia research on tariff incidence.
Congressional Budget Office, “The Effects of Tariffs on the Federal Budget and the Economy.”
U.S. Department of Agriculture, Market Facilitation Program reports.
International Monetary Fund; Federal Reserve analyses on global imbalances.
German Federal Government “Zeitenwende” defense announcements (2022).
World Trade Organization dispute settlement data.
Peterson Institute for International Economics trade impact research.
CCP Wall Street globalist hogwash. The US funded Global Order is dead. We all noted how f*cked the industrialized West was when supply chains broke down during the pandemic. We also noted how f*cked the US working class was over the last 35 years. Frankly my dear, I am a 1 percenter and I don't give a f*ck that my investment portfolio might take a hit as we turn back the clock on the idiot mistake allowing communist China into the WTO and NAFTA.
We are well into Trump's national industrial policy. It has only been about one year, and the trillions in capital flowing in to reshore industry and manufacturing is only getting started.
Please note too... the Trump tariffs are targeting your CCP friends and not the rest of the free world. The leaders of the free world know this.
The comment conflates several distinct issues in a way that undermines its argument. First, claiming that all critique of Trump’s trade policy is “CCP Wall Street globalist hogwash” is a rhetorical attack, not an economic argument. It dismisses well-documented analyses of trade impacts that rely on empirical data rather than ideology.
Reshoring and “Trillions in Capital”
The claim that trillions are flowing back to U.S. manufacturing is overstated. According to the Brookings Institution, while there has been some reshoring activity, the total investment in U.S. manufacturing attributable to tariffs remains in the tens of billions—far short of “trillions”—and is concentrated in a few sectors like steel and aluminum.¹ Broadly speaking, tariffs do not magically reverse decades of offshoring; supply chains are deeply globalized, and relocating them is slow, expensive, and often economically inefficient.²
Additionally, capital flows alone do not guarantee employment gains. Automation and productivity improvements mean that reshoring a factory does not necessarily translate to large-scale rehiring of U.S. workers. Research by the Peterson Institute for International Economics shows that gains in protected industries were offset by losses in downstream industries that rely on imported inputs.³
Supply Chain Disruption Isn’t Evidence of Success
The pandemic-related supply chain breakdowns the comment references do not justify blanket tariffs as a solution. Supply chain resilience requires strategic diversification, logistics investment, and inventory planning—not punitive import taxes that raise costs for U.S. manufacturers and consumers. Studies in the Harvard Business School and McKinsey & Company show that tariffs often worsen, rather than improve, supply chain flexibility.⁴
Targeting China vs. the “Free World”
It is true that most U.S. tariffs under Trump were aimed at China. But in practice, global supply chains are interconnected, and tariffs on Chinese goods indirectly hit U.S. businesses and consumers worldwide. For example, tariffs on Chinese intermediate goods raised costs for U.S. manufacturers who assemble or reexport products, and European and Asian firms have been affected through higher input prices and trade diversion.⁵
The claim that “the leaders of the free world know this” is unproven. European and Japanese officials repeatedly protested Trump’s tariffs, not merely for show, but because the measures threatened economic growth and disrupted investment plans in allied nations. Diplomatic signals, trade disputes, and WTO complaints are not theatrics—they reflect concrete economic impacts.⁶
National Industrial Policy vs. Evidence-Based Results
Finally, framing this as a triumph of Trump’s “national industrial policy” after only a year ignores the economic realities. Reshoring, wage growth, or supply chain recovery takes multiple years to materialize. Early-stage capital allocation does not equal measurable policy success. Economists warn that premature claims of industrial revival based on rhetoric rather than metrics risk creating false narratives that overlook costs to consumers, businesses, and workers in affected sectors.⁷
In short: Tariffs targeting China are not inherently bad, but claiming they have already reshaped U.S. industry, “reshored trillions,” or vindicated Trump’s approach oversimplifies complex economic dynamics and ignores documented trade-offs. Empirical research consistently shows that tariffs impose real costs, have uneven effects, and are no substitute for a comprehensive industrial strategy that balances investment, workforce development, and global competitiveness.
Nobody credible has made the argument that in 13 months Trump's economic policies have "reshored trillions". The measure is trillions in capital investment to build and expand domestic industry and manufacturing. It took 80 years for the post WWII Bretton Woods Global Order to erase so many industrial and manufacturing advantages that powered the US middle class. They cannot be replaced in 13 months.
I own a US-based manufacturing business. Frankly, most of the raw material inflation I am dealing with came before Trump tariffs. There has not been much upward movement since Trump took office. Some of the imported equipment that I would prefer to buy from American producers but there are none, has gone up in cost... but not matching the tariffs. Pricing isn't completely elastic that way. Customers have alternatives including holding onto existing equipment longer. Or in some cases, they can switch product direction if costs exceed their budget capacity. There has been tremendous corporate profit taking over the last decade. Corporate consolidation fueled by globalism has eliminated a lot of competition and the big producers raised prices. Timing for tariffs was good as the big producers had already gone hog wild and spent all their capacity in price increases... so they are back to eating more of those expenses as they cannot pass on the full increase to customers as it would result in lower sales (Laffer Curve stuff).
Every country, even though doing the performative anti-Trump and anti-tariff media game, know that they need to pull back to a national industrial policy and not rely on the US-keeping its consumer markets wide open and the oceans policed and protected for cheap tanker and cargo shipping. Tariffs are just a tool to get it all done quickly, as it is inevitable. The Global Order was no longer sustainable at least 30 years ago.
The argument conflates anecdotal experience and macroeconomic history in ways that distort the picture of Trump-era trade policy. Owning a U.S. manufacturing business gives insight into day-to-day costs, but micro-level observations cannot substitute for aggregate data on trade, investment, and labor market outcomes.
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Capital Investment vs. Actual Reshoring
The claim of “trillions in capital investment” to rebuild U.S. manufacturing is vague and largely unsubstantiated. A report from the Brookings Institution finds that while there has been modest growth in domestic capital expenditure, it remains concentrated in a few sectors and does not approach trillions in aggregate new productive capacity.¹
Capital commitments do not equal realized output, jobs, or increased industrial self-sufficiency. Many projects are speculative, delayed, or financed with incentives tied to tax policy rather than tariffs. Early-stage investment does not automatically translate into durable industrial revival. Historical context—the postwar erosion of U.S. industrial primacy—is real, but policy claims that 13 months of tariffs are reversing decades of globalization are aspirational at best, not evidence-based.²
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Tariffs and Inflation
While it is true that raw material inflation preceded Trump-era tariffs, multiple studies confirm that tariffs contributed to higher costs for both manufacturers and consumers. Research from the Federal Reserve Bank of New York and Peterson Institute for International Economics shows that tariffs on steel, aluminum, and Chinese imports were partially passed on to U.S. businesses, raising production costs even if not perfectly elastic.³⁴
The assertion that large producers absorbed most of the cost ignores evidence that tariffs shift burdens unevenly. Firms with less market power, smaller manufacturers, and regional suppliers often bear the brunt, while large firms may partially offset costs through pricing power or consolidation.⁵ The Laffer Curve analogy also misapplies a tax revenue concept to input cost pass-through—it does not justify tariffs as a structural industrial strategy.
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Global Order and Industrial Policy
The assertion that “every country” recognizes the need to pull back toward national industrial policy overstates global consensus. Many countries—especially European and Asian allies—continue to emphasize multilateral trade, regulatory coordination, and market openness because their industrial and technological competitiveness depends on integrated global supply chains.⁶ Even U.S. allies with strong manufacturing bases, like Germany and Japan, have pushed back against unilateral tariffs, not just performatively, but because tariffs disrupt supply chains critical to their exports and domestic employment.
While it is true that the postwar global order faced imbalances, the claim that tariffs alone are the “inevitable” solution oversimplifies decades of economic integration and underestimates alternative policy tools, including targeted industrial investment, workforce development, and strategic supply chain incentives.⁷
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Evidence vs. Anecdote
Finally, the reasoning relies heavily on anecdotal evidence (“I own a manufacturing business”) and selective historical narrative. Robust policy assessment requires aggregate data: GDP, trade deficits, manufacturing output, employment, and investment realized, not projected. Current research indicates that tariffs have had mixed or negative effects on U.S. industrial competitiveness overall, especially when downstream supply chains and labor impacts are considered.⁸
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In short: Early capital investments and short-term market adjustments do not validate the claim that tariffs alone are restoring U.S. industrial primacy. Policy effectiveness requires sustained, multi-year strategy that aligns investment, workforce, and trade frameworks—not just punitive import taxes. Anecdote and historical generalization cannot replace empirical evidence.
Annual factory capital investment in the U.S. tripled from billion in 2021 to nearly billion by late 2024, driven by a manufacturing resurgence in semiconductors, electronics, and pharmaceuticals. Total announced private-sector commitments have reached over trillion, aimed at rebuilding industrial capacity.
Key Investment Drivers & Data
Total Investment Scope: As of early 2026, private-sector, announced commitments for manufacturing, including reshoring efforts, have reached approximately
trillion.
Growth Trend: The annual rate of capital investment in factories rose from
billion in 2021 to almost
billion by late 2024, although this still only represents a 5% growth rate relative to the total U.S. manufacturing capital base.
Sector Highlights: Investment is heavily concentrated in technology and infrastructure, with semiconductors and advanced computing leading the sector. Other major investments include Stellantis (
billion), Whirlpool (
million), and various energy-related projects.
Foreign Direct Investment (FDI): Foreign investment in 2024 was significant, with manufacturing, particularly in chemicals, receiving
billion.
Future Needs: Economists estimate that returning manufacturing employment to its 1970s peak would require roughly
trillion in net new capital investment.
Recent Large-Scale Investments (2025-2026)
Tech & AI: Major tech firms, including Amazon, Microsoft, Alphabet, and Meta, have committed approximately
billion to US manufacturing.
Automotive/Industrial: Hyundai Motor Group announced a
billion investment for a new steel facility. Rivian is building a
billion assembly plant in Georgia.
General Manufacturing: Kraft Heinz (
billion), GE Appliances ( billion), and Biogen ( billion) have announced major plant upgrades and expansions.
The narrative of “trillions in capital” as proof of a Trump-era industrial renaissance conflates announced investments with realized output, and exaggerates their transformative economic impact. Announcements alone do not equal completed plants, increased production, or meaningful job growth. Economists differentiate between committed capital and productive capacity—the former can be delayed, scaled back, or canceled entirely.¹
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Concentration vs. Breadth
The investments cited are heavily concentrated in a few sectors: semiconductors, tech, pharmaceuticals, and select automotive projects. While these industries are strategically important, they represent a small fraction of total U.S. manufacturing employment and output. The Bureau of Economic Analysis shows that advanced manufacturing contributes disproportionately to GDP but only modestly to overall workforce expansion.² Boosting a few high-tech sectors does not meaningfully “restore” the broad industrial base that powered the U.S. middle class in the mid-20th century.
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Scaling and Timing
Even if all announced projects are realized, rebuilding the U.S. manufacturing infrastructure at scale would take decades, not months. The claim that 13 months of tariffs or early investment commitments are reshaping the U.S. industrial landscape ignores the long timelines required for plant construction, workforce training, and supply chain integration.³ Semiconductor fabrication plants, for example, take 2–3 years to become operational after ground-breaking.
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Announced Investments vs. Economic Impact
Many cited investments, particularly from tech firms like Amazon, Microsoft, and Meta, are often automation-heavy facilities that create relatively few manufacturing jobs. Capital-intensive projects do not necessarily translate into broad-based labor benefits, which is central to the claim that trade policy is “helping American workers.”⁴
Moreover, foreign direct investment (FDI) inflows may reflect strategic corporate decisions and tax incentives, not necessarily the result of unilateral tariff policy. Investments in chemicals, energy, and automotive may have been planned years in advance and influenced by federal and state economic development programs, rather than short-term trade leverage.⁵
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The Scale Problem
Restoring manufacturing employment or production to 1970s levels would require trillions in sustained capital and decades of execution, far beyond what announced projects alone represent. Even aggregating all announced capital commitments, the net effect on employment, GDP, and trade balance is likely modest in the short term.⁶
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Key Takeaway
Announced investment figures are often used rhetorically to suggest an industrial “renaissance,” but they overstate immediate economic reality. Actual transformation requires multi-year execution, workforce development, and complementary policy measures. Claims that tariffs have catalyzed a sudden, sweeping reshoring of U.S. industry are therefore premature and empirically unsupported.
"Capital commitments do not equal realized output, jobs, or increased industrial self-sufficiency."
This the most economically inane comment you have made and is clear proof that you know not what you are talking about.
How can we see any increase to domestic industry and manufacturing without capital investment in new and expanded industry and manufacturing?
Another business I run is an SBA lender for commercial real estate for small business including a lot of small manufacturers. How does one start or grow a manufacturing business without capital to invest in the plant, equipment and labor?
The first step to any revitalization of markets supporting industry and manufacturing is capital investment.
You need to better educate yourself to be credible in this subject domain. Read Apple in China. Also read The End of the World is Just the Beginning by Peter Zeihan.
1. Capital commitments are not the same as capital investment.
A commitment is an announcement or pledge. An investment is money actually deployed into plant, equipment, hiring, and production. Those are different stages.
Projects get delayed, scaled down, restructured, or cancelled all the time. In finance and economics, analysts distinguish between announced, committed, and realized capital expenditures precisely because many commitments never fully materialize.
Saying “capital commitments do not equal realized output” isn’t inane — it’s a standard analytical distinction. A term sheet isn’t the same as funds disbursed. A press release isn’t the same as factories producing at scale.
Capital is necessary, but it is not proof of industrial revival. Output, productivity, and sustained employment growth are.
2. Ad hominem attacks don’t strengthen an argument.
Calling me “economically inane” or telling someone to “educate yourself” doesn’t address the substance of the claim. It attacks the person rather than the reasoning.
If the argument is wrong, the rebuttal should show data — realized capital expenditure, manufacturing output growth, measurable gains in self-sufficiency. Insults don’t substitute for evidence.
The issue isn’t whether capital matters. It does. The issue is whether announced commitments already prove structural industrial revival. That requires outcomes, not rhetoric or personal attacks.
Interestingly all your sources have vested interest in keeping the status quo.
You state: But acknowledging worker harm does not validate tariffs as the optimal solution. Effective worker-centered policy might include wage insurance, skills investment, domestic industrial strategy, infrastructure modernization, and coordinated enforcement of trade rules—not blanket import taxes that raise input costs for American manufacturers.
Wage insurance? What the hell is that? Skills investment? Really? You believe trying to teach a 50 year old machinist to become a physical therapist a great solution? I'm in the infrastructure modernization field. It makes manufacturing more efficient and it's implemented by manufacturers, not through policy. Why? To gain market share, profits, growth, etc. Are you actually reading what you are writing?
I am so sick of the elite looter and gambling class demanding continued corporate profit maximization and corporate shareholder return maximization while ignoring the wholesale destruction of working-class economic circumstances. They arguments are all focused on measures that are only indicative of the financial wellbeing of the upper 10% that own 88% of the stock market. Steve's real name is probably Chinese.
Calling something “AI slop” isn’t a rebuttal — it’s an admission you don’t want to engage the facts.
If any specific claim is wrong, point it out. Show where the numbers are off. Challenge the assumptions about farm scale, capital costs, labor substitution, or consolidation trends. That’s how debate works.
Dismissing an argument because it may have been drafted with assistance is not a counterargument. It’s avoidance.
The dairy industry’s consolidation, capital intensity, and technology adoption trends are real whether someone types the response manually or uses a tool. Attacking the medium instead of the substance suggests you don’t have a response to the substance.
If you want to have a serious discussion about agribusiness economics, let’s do that. If not, just say so.
The piece gets the drama right but the economics wrong. It treats Trump’s tariff brinkmanship as the prime mover behind Europe’s strategic shifts, when in reality events like the war in Ukraine have done far more to jolt European defense spending and trade postures. More fundamentally, the essay misreads trade liberalization itself — which succeeds by deepening interdependence, not by threatening partners into one-sided concessions.
Calling this a “new trading system” obscures the fact that it’s closer to managed protectionism than liberalization. Nationalist trade strategies may score short-term wins but ultimately breed inefficiency, retaliation, and mistrust. History offers plenty of cautionary examples — Perón’s Argentina, for instance — where autarkic thinking cloaked itself in patriotic rhetoric but led to stagnation and decline. When the U.S. frames economic strength as a zero-sum contest, it only pushes allies toward defensive arrangements with China and others. That’s not a durable trade revolution; it’s the slow unraveling of an open system that American prosperity was built on.
Said like another nay sayer who just doesn’t get it. Trump is motivating major changes that past admins dreamed of and pleaded for with no effect. Trump’s results speak volumes.
That’s exactly what Perón’s followers said in Argentina — that “the results speak for themselves” and that his strongman tactics were finally getting things done the elites never could. And for a while, it looked that way: pride swelling, foreign critics dismissed as “naysayers.” But nationalist economics always run the same course — initial shock gains, then isolation, inflation, and stagnation once partners adapt and capital flees.
The results really did speak for themselves in the end — just not the way his supporters expected. America should learn from that history, not try to replay it.
No need for armchair psychology—let’s stick to the data. Blue-collar job growth flipped negative right after Trump’s inauguration, construction investment has been sliding (with data centers propping up the numbers for years, not broad manufacturing revival), and manufacturing’s “acceleration” looks more cyclical than revolutionary. [ from earlier]
Why can’t you distinguish Trump from Perón? Both promise nationalist wins through tariffs and strongman tactics, tout early “results” like job stats to drown out critics, and ignore how those paths end in inefficiency, retaliation, and stagnation—Argentina’s playbook, now with an American accent.
With luck, I do think we will avoid Argentina’s fate because our institutions are stronger and more independent (like SCOTUS with its recent tariff decision) - and that will prevent the worst of the Executive Branch’s economic decisions. Only time will tell.
Ukraine war was going for 3 years with ~zero change in NATO defense spending. The head of NATO in Brussels specifically credited Trump for changing this
This is true. None of his predecessors ever attained the status of a bully that can neither be believed nor trusted. We should acknowledge his singular accomplishment.
The question I didn't see addressed is......for how long? Is this capitulation, or is this accepting terms for now, but then building a strategic alternative. Time will tell.
Thanks for this excellent post - none of us has a crystal ball, but un/der-employment and addiction are threatening entire generations of US workers. We have to do something to bring back local economies and communities, and well-fed arguments re: efficiencies and inevitabilities are tone-deaf to this reality. Thank you again!
No thoughtful person interested in global economics would ever question the need for rebalancing trade inequities, nor the carefully planned and strategically gamed application of them by the US government. And yes, global trade partners will complain, and talking head economists will judge. But the problem isn’t one of seeking balance; the problem is the capricious nature of the actions and the uncertainty it leads to in critical US mfg supply chains, and the undermining of longstanding relationships in the name of showmanship and I. Place of testosterone standoffs for old men who no longer remember what testosterone felt like. Wake up, Lynn.
Bollocks. Trump’s tariffs are being paid by American consumers and companies. The US debt burden keeps on growing and slowly- so far-US control of the international monetary system is being eroded.
Yes, there cowardly, inadequate European leaders but the end of yet another empire is almost in sight.
Whether we like what replaces it is quite another question.
Hilarious! European defence spending is up because European nations are funding the Ukraine defence against Russia and have realised that the USA cannot be trusted. As América drifts into totalitarianism with state sponsored agression on it’s streets, it is clear, not before time, that Europe needs to step up as the standard bearer for democracy, freedom of speech and humanitarian government.
The real war is between two factions that exist in every country. It's centralization (the one-world, liberal, rules-based order) vs decentralization (sovereign nations prioritizing their own interests). The trade model that is going away is centrally controlled global trade. The trade deficits existed everywhere because the US economy was subsidizing those centralizing factions in every country to enable them to maintain control, nation by nation. It's not like all of those unbalanced trade deals came about naturally. Nations and companies were forced to do business under certain conditions, handed down from above.
"Trade imbalances on the scale of the 2010s are unsustainable." And why is that? Is that even true? No, it isn't. Japan has had a trade surplus on the order of $1.4T. For that $1.4T Japan has given the US $1.4T in goods. Huh. What exactly is unsustainable about that? These tariffs are restructuring diplomacy and trade agreements and future trade will allow the US to be erased from certain trade packages. That is not good for the US.
Most of the anti Trump, anti tariff comments fall into the same bad logic that has led us the failing neo-liberal world order. Namely, that disconnecting trade from mutual defense and shared values has created a massive tragedy of the commons.
Unless America and Europe are willing to repeal over a hundred years worth of environmental and labor laws, we're doomed to watch one industry after another go to corrupt, irresponsible and increasingly authoritarian nations. There will always be someone more willing to exploit their people and environments to take advantage of other nations. This is a very old commons problem. Since there is little to nothing being done under the current rules based order to address this commons problem, the current system is a poverty trap.
Then you have to deal with defense. From fighting pirates off the coast of Somalia, to chasing terrorists around the middle east, the world always turns to America to backstop the needs to protect the global supply chains feeding all those foreign factories. The really ironic part is that even as many turn to America to prevent the Chinese or Russians from taking over their territories, China and Russia are far more dependent then they realize, on the might and power of the US navy to protect their shipping and foreign interests from pirates and terrorists, just like everybody else.
Yet we see Americans pulling back from defending the rest of the world. On the left they want big cuts to defense so they can spend more on welfare. On the right, they increasingly want to bring our military home. These sentiments will only grow as the need to cut spending and reform domestic programs grow. Again, a classic commons problem. One that current trade agreements try to ignore.
It's amazing how so many people can spot a commons problem, when it's done to "help" the poor, from a mile away. Yet when the whole geo-political world order is falling apart around them, they get lost in a bunch of economic jargon all while ignoring two of the oldest commons problems known to man.
Ignore the Hype. Trump’s Tariff Strategy Isn’t Delivering the Wins It Claims.
The argument that President Trump’s tariff-heavy trade policy is quietly “working” rests on a selective reading of events and a misunderstanding of how trade balances, supply chains, and allied politics function. Yes, foreign leaders publicly criticize U.S. tariffs while privately negotiating adjustments. That is how diplomacy works. But the available evidence does not support the claim that tariffs have fundamentally restructured global trade in America’s favor—or that they have meaningfully strengthened American workers.
Tariffs Have Imposed Real Domestic Costs
The first problem with the “it’s working” thesis is that tariffs are taxes paid largely by Americans. Multiple empirical studies of the 2018–2019 tariff rounds found that the costs were borne primarily by U.S. firms and consumers, not foreign exporters. Economists from Princeton, Columbia, and the Federal Reserve Bank of New York concluded that “the incidence of the tariffs fell entirely on domestic consumers and importers,” with no measurable reduction in foreign exporters’ prices.¹
The nonpartisan Congressional Budget Office estimated that the 2018–2019 tariffs reduced U.S. real GDP and household income, lowering average real household income by hundreds of dollars annually.² Meanwhile, retaliatory tariffs reduced U.S. agricultural exports sharply, requiring tens of billions of dollars in federal aid to farmers to offset losses.³
If a policy requires large domestic subsidies to counteract its side effects, that is not evidence of quiet success. It is evidence of distortion.
Trade Deficits Are Not Simple Scorecards
The claim that trade imbalances prove systemic unfairness is rhetorically powerful but economically misleading. Trade balances reflect macroeconomic factors—particularly savings and investment patterns—not simply tariff barriers. The International Monetary Fund and the Federal Reserve have both emphasized that persistent U.S. trade deficits are closely tied to the dollar’s role as the world’s reserve currency and America’s relatively low savings rate.⁴
Even after the imposition of tariffs, the overall U.S. trade deficit widened in subsequent years. Bilateral deficits shifted among trading partners, but the aggregate imbalance remained substantial. Tariffs altered sourcing patterns—often from China to Vietnam or Mexico—but did not eliminate structural trade gaps.
That suggests the policy has rearranged supply chains more than it has reshaped the global trading order.
Allied Defense Spending Has Broader Drivers
Germany’s increased defense spending is frequently cited as proof that tariff pressure works. But Berlin’s spending surge followed Russia’s full-scale invasion of Ukraine in 2022—an exogenous geopolitical shock that transformed European security priorities. The €100 billion “Zeitenwende” fund announced by Chancellor Olaf Scholz was explicitly framed as a response to Russian aggression, not auto tariffs.⁵
Defense procurement decisions also follow multi-year planning cycles shaped by NATO commitments, industrial policy, and threat perception. Attributing these shifts primarily to tariff threats oversimplifies complex strategic decisions.
Multilateral Systems Delivered Concrete Gains
The postwar trading system was hardly static or naïve. Under the World Trade Organization, the United States won the vast majority of dispute settlement cases it brought against trading partners.⁶ The U.S.-Mexico-Canada Agreement (USMCA), often cited as a triumph of unilateral pressure, preserved much of the structure of NAFTA while introducing negotiated updates—an example of continuity as much as rupture.
Moreover, research from the Peterson Institute for International Economics finds limited evidence that tariffs revived broad U.S. manufacturing employment trends, which are driven more by automation and productivity growth than trade alone.⁷ Manufacturing output rose and fell with macroeconomic cycles, but long-term employment decline predates China’s WTO accession and reflects structural technological change.
Workers Deserve Policy That Works
None of this means the old consensus was flawless. Trade adjustment assistance was often underfunded. Regional dislocation was real. The “China shock,” documented in peer-reviewed research, had severe local labor market effects.⁸
But acknowledging worker harm does not validate tariffs as the optimal solution. Effective worker-centered policy might include wage insurance, skills investment, domestic industrial strategy, infrastructure modernization, and coordinated enforcement of trade rules—not blanket import taxes that raise input costs for American manufacturers.
In fact, many U.S. manufacturers rely on imported intermediate goods. Tariffs on steel and aluminum, for example, increased costs for downstream industries that employ far more workers than primary metal production. Studies found that job gains in protected industries were offset—or exceeded—by job losses in tariff-affected sectors.⁹
Real Reform Requires Strategy, Not Shock
The core question is not whether the previous system was imperfect. It was. The question is whether unpredictability and tariffs are delivering durable structural gains.
Evidence so far suggests a more modest outcome: higher input costs, reshuffled supply chains, continued macro-level trade deficits, and episodic diplomatic friction. That is not a revolution. It is a high-cost renegotiation with ambiguous net results.
The United States absolutely has leverage as the world’s largest consumer market. But leverage is most powerful when deployed predictably and in coordination with allies, not when it alienates partners whose cooperation is essential in areas from export controls to technology standards.
History will judge this era not by rhetorical toughness, but by measurable outcomes: sustained productivity growth, rising real wages, resilient supply chains, and stable alliances. On those metrics, the verdict remains very much unsettled.
Outrage is not analysis. But neither is selective accounting.
Sources
Amiti, Redding & Weinstein (2019), Federal Reserve Bank of New York / Princeton / Columbia research on tariff incidence.
Congressional Budget Office, “The Effects of Tariffs on the Federal Budget and the Economy.”
U.S. Department of Agriculture, Market Facilitation Program reports.
International Monetary Fund; Federal Reserve analyses on global imbalances.
German Federal Government “Zeitenwende” defense announcements (2022).
World Trade Organization dispute settlement data.
Peterson Institute for International Economics trade impact research.
Autor, Dorn & Hanson (2013, 2016) “China Shock” research.
Federal Reserve and academic analyses of steel and aluminum tariff effects.
CCP Wall Street globalist hogwash. The US funded Global Order is dead. We all noted how f*cked the industrialized West was when supply chains broke down during the pandemic. We also noted how f*cked the US working class was over the last 35 years. Frankly my dear, I am a 1 percenter and I don't give a f*ck that my investment portfolio might take a hit as we turn back the clock on the idiot mistake allowing communist China into the WTO and NAFTA.
We are well into Trump's national industrial policy. It has only been about one year, and the trillions in capital flowing in to reshore industry and manufacturing is only getting started.
Please note too... the Trump tariffs are targeting your CCP friends and not the rest of the free world. The leaders of the free world know this.
The comment conflates several distinct issues in a way that undermines its argument. First, claiming that all critique of Trump’s trade policy is “CCP Wall Street globalist hogwash” is a rhetorical attack, not an economic argument. It dismisses well-documented analyses of trade impacts that rely on empirical data rather than ideology.
Reshoring and “Trillions in Capital”
The claim that trillions are flowing back to U.S. manufacturing is overstated. According to the Brookings Institution, while there has been some reshoring activity, the total investment in U.S. manufacturing attributable to tariffs remains in the tens of billions—far short of “trillions”—and is concentrated in a few sectors like steel and aluminum.¹ Broadly speaking, tariffs do not magically reverse decades of offshoring; supply chains are deeply globalized, and relocating them is slow, expensive, and often economically inefficient.²
Additionally, capital flows alone do not guarantee employment gains. Automation and productivity improvements mean that reshoring a factory does not necessarily translate to large-scale rehiring of U.S. workers. Research by the Peterson Institute for International Economics shows that gains in protected industries were offset by losses in downstream industries that rely on imported inputs.³
Supply Chain Disruption Isn’t Evidence of Success
The pandemic-related supply chain breakdowns the comment references do not justify blanket tariffs as a solution. Supply chain resilience requires strategic diversification, logistics investment, and inventory planning—not punitive import taxes that raise costs for U.S. manufacturers and consumers. Studies in the Harvard Business School and McKinsey & Company show that tariffs often worsen, rather than improve, supply chain flexibility.⁴
Targeting China vs. the “Free World”
It is true that most U.S. tariffs under Trump were aimed at China. But in practice, global supply chains are interconnected, and tariffs on Chinese goods indirectly hit U.S. businesses and consumers worldwide. For example, tariffs on Chinese intermediate goods raised costs for U.S. manufacturers who assemble or reexport products, and European and Asian firms have been affected through higher input prices and trade diversion.⁵
The claim that “the leaders of the free world know this” is unproven. European and Japanese officials repeatedly protested Trump’s tariffs, not merely for show, but because the measures threatened economic growth and disrupted investment plans in allied nations. Diplomatic signals, trade disputes, and WTO complaints are not theatrics—they reflect concrete economic impacts.⁶
National Industrial Policy vs. Evidence-Based Results
Finally, framing this as a triumph of Trump’s “national industrial policy” after only a year ignores the economic realities. Reshoring, wage growth, or supply chain recovery takes multiple years to materialize. Early-stage capital allocation does not equal measurable policy success. Economists warn that premature claims of industrial revival based on rhetoric rather than metrics risk creating false narratives that overlook costs to consumers, businesses, and workers in affected sectors.⁷
In short: Tariffs targeting China are not inherently bad, but claiming they have already reshaped U.S. industry, “reshored trillions,” or vindicated Trump’s approach oversimplifies complex economic dynamics and ignores documented trade-offs. Empirical research consistently shows that tariffs impose real costs, have uneven effects, and are no substitute for a comprehensive industrial strategy that balances investment, workforce development, and global competitiveness.
Nobody credible has made the argument that in 13 months Trump's economic policies have "reshored trillions". The measure is trillions in capital investment to build and expand domestic industry and manufacturing. It took 80 years for the post WWII Bretton Woods Global Order to erase so many industrial and manufacturing advantages that powered the US middle class. They cannot be replaced in 13 months.
I own a US-based manufacturing business. Frankly, most of the raw material inflation I am dealing with came before Trump tariffs. There has not been much upward movement since Trump took office. Some of the imported equipment that I would prefer to buy from American producers but there are none, has gone up in cost... but not matching the tariffs. Pricing isn't completely elastic that way. Customers have alternatives including holding onto existing equipment longer. Or in some cases, they can switch product direction if costs exceed their budget capacity. There has been tremendous corporate profit taking over the last decade. Corporate consolidation fueled by globalism has eliminated a lot of competition and the big producers raised prices. Timing for tariffs was good as the big producers had already gone hog wild and spent all their capacity in price increases... so they are back to eating more of those expenses as they cannot pass on the full increase to customers as it would result in lower sales (Laffer Curve stuff).
Every country, even though doing the performative anti-Trump and anti-tariff media game, know that they need to pull back to a national industrial policy and not rely on the US-keeping its consumer markets wide open and the oceans policed and protected for cheap tanker and cargo shipping. Tariffs are just a tool to get it all done quickly, as it is inevitable. The Global Order was no longer sustainable at least 30 years ago.
The argument conflates anecdotal experience and macroeconomic history in ways that distort the picture of Trump-era trade policy. Owning a U.S. manufacturing business gives insight into day-to-day costs, but micro-level observations cannot substitute for aggregate data on trade, investment, and labor market outcomes.
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Capital Investment vs. Actual Reshoring
The claim of “trillions in capital investment” to rebuild U.S. manufacturing is vague and largely unsubstantiated. A report from the Brookings Institution finds that while there has been modest growth in domestic capital expenditure, it remains concentrated in a few sectors and does not approach trillions in aggregate new productive capacity.¹
Capital commitments do not equal realized output, jobs, or increased industrial self-sufficiency. Many projects are speculative, delayed, or financed with incentives tied to tax policy rather than tariffs. Early-stage investment does not automatically translate into durable industrial revival. Historical context—the postwar erosion of U.S. industrial primacy—is real, but policy claims that 13 months of tariffs are reversing decades of globalization are aspirational at best, not evidence-based.²
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Tariffs and Inflation
While it is true that raw material inflation preceded Trump-era tariffs, multiple studies confirm that tariffs contributed to higher costs for both manufacturers and consumers. Research from the Federal Reserve Bank of New York and Peterson Institute for International Economics shows that tariffs on steel, aluminum, and Chinese imports were partially passed on to U.S. businesses, raising production costs even if not perfectly elastic.³⁴
The assertion that large producers absorbed most of the cost ignores evidence that tariffs shift burdens unevenly. Firms with less market power, smaller manufacturers, and regional suppliers often bear the brunt, while large firms may partially offset costs through pricing power or consolidation.⁵ The Laffer Curve analogy also misapplies a tax revenue concept to input cost pass-through—it does not justify tariffs as a structural industrial strategy.
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Global Order and Industrial Policy
The assertion that “every country” recognizes the need to pull back toward national industrial policy overstates global consensus. Many countries—especially European and Asian allies—continue to emphasize multilateral trade, regulatory coordination, and market openness because their industrial and technological competitiveness depends on integrated global supply chains.⁶ Even U.S. allies with strong manufacturing bases, like Germany and Japan, have pushed back against unilateral tariffs, not just performatively, but because tariffs disrupt supply chains critical to their exports and domestic employment.
While it is true that the postwar global order faced imbalances, the claim that tariffs alone are the “inevitable” solution oversimplifies decades of economic integration and underestimates alternative policy tools, including targeted industrial investment, workforce development, and strategic supply chain incentives.⁷
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Evidence vs. Anecdote
Finally, the reasoning relies heavily on anecdotal evidence (“I own a manufacturing business”) and selective historical narrative. Robust policy assessment requires aggregate data: GDP, trade deficits, manufacturing output, employment, and investment realized, not projected. Current research indicates that tariffs have had mixed or negative effects on U.S. industrial competitiveness overall, especially when downstream supply chains and labor impacts are considered.⁸
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In short: Early capital investments and short-term market adjustments do not validate the claim that tariffs alone are restoring U.S. industrial primacy. Policy effectiveness requires sustained, multi-year strategy that aligns investment, workforce, and trade frameworks—not just punitive import taxes. Anecdote and historical generalization cannot replace empirical evidence.
AI Overview
Annual factory capital investment in the U.S. tripled from billion in 2021 to nearly billion by late 2024, driven by a manufacturing resurgence in semiconductors, electronics, and pharmaceuticals. Total announced private-sector commitments have reached over trillion, aimed at rebuilding industrial capacity.
Key Investment Drivers & Data
Total Investment Scope: As of early 2026, private-sector, announced commitments for manufacturing, including reshoring efforts, have reached approximately
trillion.
Growth Trend: The annual rate of capital investment in factories rose from
billion in 2021 to almost
billion by late 2024, although this still only represents a 5% growth rate relative to the total U.S. manufacturing capital base.
Sector Highlights: Investment is heavily concentrated in technology and infrastructure, with semiconductors and advanced computing leading the sector. Other major investments include Stellantis (
billion), Whirlpool (
million), and various energy-related projects.
Foreign Direct Investment (FDI): Foreign investment in 2024 was significant, with manufacturing, particularly in chemicals, receiving
billion.
Future Needs: Economists estimate that returning manufacturing employment to its 1970s peak would require roughly
trillion in net new capital investment.
Recent Large-Scale Investments (2025-2026)
Tech & AI: Major tech firms, including Amazon, Microsoft, Alphabet, and Meta, have committed approximately
billion to US manufacturing.
Automotive/Industrial: Hyundai Motor Group announced a
billion investment for a new steel facility. Rivian is building a
billion assembly plant in Georgia.
General Manufacturing: Kraft Heinz (
billion), GE Appliances ( billion), and Biogen ( billion) have announced major plant upgrades and expansions.
The narrative of “trillions in capital” as proof of a Trump-era industrial renaissance conflates announced investments with realized output, and exaggerates their transformative economic impact. Announcements alone do not equal completed plants, increased production, or meaningful job growth. Economists differentiate between committed capital and productive capacity—the former can be delayed, scaled back, or canceled entirely.¹
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Concentration vs. Breadth
The investments cited are heavily concentrated in a few sectors: semiconductors, tech, pharmaceuticals, and select automotive projects. While these industries are strategically important, they represent a small fraction of total U.S. manufacturing employment and output. The Bureau of Economic Analysis shows that advanced manufacturing contributes disproportionately to GDP but only modestly to overall workforce expansion.² Boosting a few high-tech sectors does not meaningfully “restore” the broad industrial base that powered the U.S. middle class in the mid-20th century.
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Scaling and Timing
Even if all announced projects are realized, rebuilding the U.S. manufacturing infrastructure at scale would take decades, not months. The claim that 13 months of tariffs or early investment commitments are reshaping the U.S. industrial landscape ignores the long timelines required for plant construction, workforce training, and supply chain integration.³ Semiconductor fabrication plants, for example, take 2–3 years to become operational after ground-breaking.
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Announced Investments vs. Economic Impact
Many cited investments, particularly from tech firms like Amazon, Microsoft, and Meta, are often automation-heavy facilities that create relatively few manufacturing jobs. Capital-intensive projects do not necessarily translate into broad-based labor benefits, which is central to the claim that trade policy is “helping American workers.”⁴
Moreover, foreign direct investment (FDI) inflows may reflect strategic corporate decisions and tax incentives, not necessarily the result of unilateral tariff policy. Investments in chemicals, energy, and automotive may have been planned years in advance and influenced by federal and state economic development programs, rather than short-term trade leverage.⁵
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The Scale Problem
Restoring manufacturing employment or production to 1970s levels would require trillions in sustained capital and decades of execution, far beyond what announced projects alone represent. Even aggregating all announced capital commitments, the net effect on employment, GDP, and trade balance is likely modest in the short term.⁶
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Key Takeaway
Announced investment figures are often used rhetorically to suggest an industrial “renaissance,” but they overstate immediate economic reality. Actual transformation requires multi-year execution, workforce development, and complementary policy measures. Claims that tariffs have catalyzed a sudden, sweeping reshoring of U.S. industry are therefore premature and empirically unsupported.
"Capital commitments do not equal realized output, jobs, or increased industrial self-sufficiency."
This the most economically inane comment you have made and is clear proof that you know not what you are talking about.
How can we see any increase to domestic industry and manufacturing without capital investment in new and expanded industry and manufacturing?
Another business I run is an SBA lender for commercial real estate for small business including a lot of small manufacturers. How does one start or grow a manufacturing business without capital to invest in the plant, equipment and labor?
The first step to any revitalization of markets supporting industry and manufacturing is capital investment.
You need to better educate yourself to be credible in this subject domain. Read Apple in China. Also read The End of the World is Just the Beginning by Peter Zeihan.
1. Capital commitments are not the same as capital investment.
A commitment is an announcement or pledge. An investment is money actually deployed into plant, equipment, hiring, and production. Those are different stages.
Projects get delayed, scaled down, restructured, or cancelled all the time. In finance and economics, analysts distinguish between announced, committed, and realized capital expenditures precisely because many commitments never fully materialize.
Saying “capital commitments do not equal realized output” isn’t inane — it’s a standard analytical distinction. A term sheet isn’t the same as funds disbursed. A press release isn’t the same as factories producing at scale.
Capital is necessary, but it is not proof of industrial revival. Output, productivity, and sustained employment growth are.
2. Ad hominem attacks don’t strengthen an argument.
Calling me “economically inane” or telling someone to “educate yourself” doesn’t address the substance of the claim. It attacks the person rather than the reasoning.
If the argument is wrong, the rebuttal should show data — realized capital expenditure, manufacturing output growth, measurable gains in self-sufficiency. Insults don’t substitute for evidence.
The issue isn’t whether capital matters. It does. The issue is whether announced commitments already prove structural industrial revival. That requires outcomes, not rhetoric or personal attacks.
Interestingly all your sources have vested interest in keeping the status quo.
You state: But acknowledging worker harm does not validate tariffs as the optimal solution. Effective worker-centered policy might include wage insurance, skills investment, domestic industrial strategy, infrastructure modernization, and coordinated enforcement of trade rules—not blanket import taxes that raise input costs for American manufacturers.
Wage insurance? What the hell is that? Skills investment? Really? You believe trying to teach a 50 year old machinist to become a physical therapist a great solution? I'm in the infrastructure modernization field. It makes manufacturing more efficient and it's implemented by manufacturers, not through policy. Why? To gain market share, profits, growth, etc. Are you actually reading what you are writing?
Exactly.
I am so sick of the elite looter and gambling class demanding continued corporate profit maximization and corporate shareholder return maximization while ignoring the wholesale destruction of working-class economic circumstances. They arguments are all focused on measures that are only indicative of the financial wellbeing of the upper 10% that own 88% of the stock market. Steve's real name is probably Chinese.
This and all your other replies are just AI slop. Congrats, you know how to use ChatGPT!
Calling something “AI slop” isn’t a rebuttal — it’s an admission you don’t want to engage the facts.
If any specific claim is wrong, point it out. Show where the numbers are off. Challenge the assumptions about farm scale, capital costs, labor substitution, or consolidation trends. That’s how debate works.
Dismissing an argument because it may have been drafted with assistance is not a counterargument. It’s avoidance.
The dairy industry’s consolidation, capital intensity, and technology adoption trends are real whether someone types the response manually or uses a tool. Attacking the medium instead of the substance suggests you don’t have a response to the substance.
If you want to have a serious discussion about agribusiness economics, let’s do that. If not, just say so.
The piece gets the drama right but the economics wrong. It treats Trump’s tariff brinkmanship as the prime mover behind Europe’s strategic shifts, when in reality events like the war in Ukraine have done far more to jolt European defense spending and trade postures. More fundamentally, the essay misreads trade liberalization itself — which succeeds by deepening interdependence, not by threatening partners into one-sided concessions.
Calling this a “new trading system” obscures the fact that it’s closer to managed protectionism than liberalization. Nationalist trade strategies may score short-term wins but ultimately breed inefficiency, retaliation, and mistrust. History offers plenty of cautionary examples — Perón’s Argentina, for instance — where autarkic thinking cloaked itself in patriotic rhetoric but led to stagnation and decline. When the U.S. frames economic strength as a zero-sum contest, it only pushes allies toward defensive arrangements with China and others. That’s not a durable trade revolution; it’s the slow unraveling of an open system that American prosperity was built on.
Said like another nay sayer who just doesn’t get it. Trump is motivating major changes that past admins dreamed of and pleaded for with no effect. Trump’s results speak volumes.
That’s exactly what Perón’s followers said in Argentina — that “the results speak for themselves” and that his strongman tactics were finally getting things done the elites never could. And for a while, it looked that way: pride swelling, foreign critics dismissed as “naysayers.” But nationalist economics always run the same course — initial shock gains, then isolation, inflation, and stagnation once partners adapt and capital flees.
The results really did speak for themselves in the end — just not the way his supporters expected. America should learn from that history, not try to replay it.
Inflation and job growth support my position. Wake up and drop your TDS:
“PHL Fed: manufacturing growth accelerates in Feb and outlook brightens as input inflationary pressures cool...; output inflation also cooled....
https://x.com/realejantoni/status/2024590329265975302?s=46&t=JbnnOF-76P53GEU6I9tNpg
No need for armchair psychology—let’s stick to the data. Blue-collar job growth flipped negative right after Trump’s inauguration, construction investment has been sliding (with data centers propping up the numbers for years, not broad manufacturing revival), and manufacturing’s “acceleration” looks more cyclical than revolutionary. [ from earlier]
Why can’t you distinguish Trump from Perón? Both promise nationalist wins through tariffs and strongman tactics, tout early “results” like job stats to drown out critics, and ignore how those paths end in inefficiency, retaliation, and stagnation—Argentina’s playbook, now with an American accent.
With luck, I do think we will avoid Argentina’s fate because our institutions are stronger and more independent (like SCOTUS with its recent tariff decision) - and that will prevent the worst of the Executive Branch’s economic decisions. Only time will tell.
Ukraine war was going for 3 years with ~zero change in NATO defense spending. The head of NATO in Brussels specifically credited Trump for changing this
This is true. None of his predecessors ever attained the status of a bully that can neither be believed nor trusted. We should acknowledge his singular accomplishment.
It's too early to tell if tariffs would work but status-quo is not an option. To criticize Trump with the old and failed logic is fatile at best
Worked to increase NATO spending and reduce EU non-tariff barriers in US tech
What is the alternative? Keep offshoring every single industry to communist China?
The question I didn't see addressed is......for how long? Is this capitulation, or is this accepting terms for now, but then building a strategic alternative. Time will tell.
All geopolitics is temporary
Thanks for this excellent post - none of us has a crystal ball, but un/der-employment and addiction are threatening entire generations of US workers. We have to do something to bring back local economies and communities, and well-fed arguments re: efficiencies and inevitabilities are tone-deaf to this reality. Thank you again!
No thoughtful person interested in global economics would ever question the need for rebalancing trade inequities, nor the carefully planned and strategically gamed application of them by the US government. And yes, global trade partners will complain, and talking head economists will judge. But the problem isn’t one of seeking balance; the problem is the capricious nature of the actions and the uncertainty it leads to in critical US mfg supply chains, and the undermining of longstanding relationships in the name of showmanship and I. Place of testosterone standoffs for old men who no longer remember what testosterone felt like. Wake up, Lynn.
Bollocks. Trump’s tariffs are being paid by American consumers and companies. The US debt burden keeps on growing and slowly- so far-US control of the international monetary system is being eroded.
Yes, there cowardly, inadequate European leaders but the end of yet another empire is almost in sight.
Whether we like what replaces it is quite another question.
Hilarious! European defence spending is up because European nations are funding the Ukraine defence against Russia and have realised that the USA cannot be trusted. As América drifts into totalitarianism with state sponsored agression on it’s streets, it is clear, not before time, that Europe needs to step up as the standard bearer for democracy, freedom of speech and humanitarian government.
The real war is between two factions that exist in every country. It's centralization (the one-world, liberal, rules-based order) vs decentralization (sovereign nations prioritizing their own interests). The trade model that is going away is centrally controlled global trade. The trade deficits existed everywhere because the US economy was subsidizing those centralizing factions in every country to enable them to maintain control, nation by nation. It's not like all of those unbalanced trade deals came about naturally. Nations and companies were forced to do business under certain conditions, handed down from above.
"Trade imbalances on the scale of the 2010s are unsustainable." And why is that? Is that even true? No, it isn't. Japan has had a trade surplus on the order of $1.4T. For that $1.4T Japan has given the US $1.4T in goods. Huh. What exactly is unsustainable about that? These tariffs are restructuring diplomacy and trade agreements and future trade will allow the US to be erased from certain trade packages. That is not good for the US.
Germany increased defense spending because Russia invaded Ukraine not for the reasons stated here.
Well I guess the supreme court’s has something to say about that. Good or bad, the way Trump did the tariffs we illegal.
This essay is well written and insightful
Most of the anti Trump, anti tariff comments fall into the same bad logic that has led us the failing neo-liberal world order. Namely, that disconnecting trade from mutual defense and shared values has created a massive tragedy of the commons.
Unless America and Europe are willing to repeal over a hundred years worth of environmental and labor laws, we're doomed to watch one industry after another go to corrupt, irresponsible and increasingly authoritarian nations. There will always be someone more willing to exploit their people and environments to take advantage of other nations. This is a very old commons problem. Since there is little to nothing being done under the current rules based order to address this commons problem, the current system is a poverty trap.
Then you have to deal with defense. From fighting pirates off the coast of Somalia, to chasing terrorists around the middle east, the world always turns to America to backstop the needs to protect the global supply chains feeding all those foreign factories. The really ironic part is that even as many turn to America to prevent the Chinese or Russians from taking over their territories, China and Russia are far more dependent then they realize, on the might and power of the US navy to protect their shipping and foreign interests from pirates and terrorists, just like everybody else.
Yet we see Americans pulling back from defending the rest of the world. On the left they want big cuts to defense so they can spend more on welfare. On the right, they increasingly want to bring our military home. These sentiments will only grow as the need to cut spending and reform domestic programs grow. Again, a classic commons problem. One that current trade agreements try to ignore.
It's amazing how so many people can spot a commons problem, when it's done to "help" the poor, from a mile away. Yet when the whole geo-political world order is falling apart around them, they get lost in a bunch of economic jargon all while ignoring two of the oldest commons problems known to man.