It’s been a volatile few weeks for Trump’s tariffs since he announced a 10% tax on all imported products from more than 50 countries, and placed additional duties on items from some of the largest U.S. trading partners, including Canada, Mexico, the European Union, and China. The additional tariffs have ranged from 25% on Canada, Mexico, and the European Union to 125% and 145% briefly on China. The imposition of these tariffs brought many countries to the negotiating table in the past two months, resulting in trillions of dollars of proposed investment in the U.S. in an attempt to reduce the additional tariffs.
Trump’s tariffs had an immediate beneficial effect on the U.S. trade deficit, according to an article titled “Goods Trade Deficit Plummets in April,” in the Wall Street Journal on May 30, 2025. The article reported that “The U.S.’s trade deficit for goods shrank substantially in April, as new tariffs weighed on imports.”
- Goods imports fell by 20% to $276.1 billion while exports rose 3.4% to $188.5 billion.
- It was the biggest one-month drop in goods imports on record
- This yielded a goods trade deficit of $87.6 billion, down from $162.3 billion in March”
President Trump has touted trillions of dollars of investments into the U.S. brought about by deals he has negotiated after the imposition of tariffs and threats of higher tariffs. The White House website provides a partial list published a partial list titled “The Trump Effect,” — which it said demonstrated “his America First economic policies have sparked trillions of dollars in new investment.”
On April 11, 2025, I was interviewed by Conner Lee, a reporter for The Epoch Times, on my opinion of Trump’s tariffs. The article ran online on April 14th and in the paper for the week of or the week of April 16-22nd in the California section I was quoted as saying, “Michele Nash-Hoff, president of ElectroFab Sales, a California-based manufacturers’ representative firm, said that businesses will know within the next three to six months whether the tariffs will be long-term.
“The tariffs will be an additional major driver to returning manufacturing to America, especially if the tariffs are not just temporary if they’re long-term,” she told The Epoch Times.
Nash-Hoff thinks the tariffs are not going to have an impact on inflation like some people are fearing. She referenced the 2018 U.S. tariffs on steel, aluminum, and some imports from China, which were followed by only about a 0.5 percent rise in the inflation rate.
She said the latest tariffs will benefit the U.S. economy by creating more American jobs, which means more people paying taxes. That, in turn, will help reduce the country’s annual trade deficit and lower its national indebtedness, she said.”
I believe that another trade deal with China that includes low rates of tariffs won’t work any better than the trade agreement President Trump negotiated in his first term. China has violated the terms of that agreement just as it did the terms of becoming a member of the World Trade Organization in the year 2000.
To ensure that China honored the terms of the WTO agreement, the United States–China Economic and Security Review Commission (informally, the U.S.–China Commission, USCC) was established on October 30, 2000. The USCC has been “responsible for providing recommendations to Congress based on their findings on bilateral trade with the People’s Republic of China, evaluating national security and trading risks in all industries and conducting research on China’s actions.” The Commission held hearings and submitted an annual report to Congress.
Year after year, the Commission reported how China violated the WTO agreement, but no punitive actions were taken by Congress for 17 years. The reports repeatedly cited China’s unfair trade policies of intellectual property theft, government subsidies to domestic manufacturers, product dumping at below cost to capture market share of particular industries, fraudulent labeling, trans-shipping, and undervaluing their currency. I have read several of the reports in the past and wrote articles about the findings. The article I wrote about the 2021 report can be found at this link.
In the May 19, 2025 Epoch Times article titled “Despite Negotiations, China Finds Ways to Circumvent US Tariffs,” Antonio Graceffo wrote “Even as Chinese leader Xi Jinping and President Donald Trump negotiate a new trade agreement, China continues to bypass U.S. tariffs through a global network of loopholes, rerouting schemes, and gray market tactics that keep its exports flowing into the United States despite trade restrictions…exploiting a combination of legal loopholes and gray zone tactics. These include exploiting postal and customs blind spots, rerouting through third countries, forged documentation, offshore assembly, and the creation of overseas distribution hubs that allow Chinese products to be re-exported under neutral labels.”
He explained, “China has also expanded its use of gray zone trade tactics by employing transshipment, committing document fraud, practicing under-invoicing, and utilizing overseas assembly. Chinese exporters are routing goods through Vietnam, Malaysia, Indonesia, Thailand, and even the European Union, where products are repackaged or relabeled to obscure their origin.”
However, if the Trump administration wants to seriously tackle the trade deficit with China, they first must handle the half a dozen lawsuits by ten states that are challenging the president’s ability to impose tariffs without the approval of Congress. On April 23, 2025, AP News reported that “A dozen states sued the Trump administration in the U.S. Court of International Trade in New York on Wednesday to stop its tariff policy, saying it is unlawful and has brought chaos to the American economy.” The lawsuits “challenged Trump’s claim that he could arbitrarily impose tariffs based on the International Emergency Economic Powers Act.”
On Wednesday, May 28, 2025, CNN Business News reported that a three-judge panel at the U.S. Court of International Trade “ruled that President Donald Trump overstepped his authority to impose sweeping tariffs that have raised the cost of imports for everyone from giant businesses to everyday Americans.” The ruling “stopped Trump’s global tariffs that he imposed citing emergency economic powers,” also “prevents Trump from enforcing his tariffs placed earlier this year against China, Mexico and Canada, designed to combat fentanyl coming into the United States.”
The tariffs have been reprieved from being stopped because, on Wednesday, May 28, 2025, ABC News reported that “The United States Court of Appeals for the Federal Circuit issued an administrative stay of the decision while it considers Trump’s appeal.”
The Coalition for a Prosperous America recommended action that can be taken by Congress to solve this problem in their weekly newsletter, Prosper Weekly. CPA PRESIDENT JON TOOMEY SAID: “Wednesday’s court ruling underscores the urgent need for Congress to act decisively to implement President Trump’s America First tariff strategy into law. While the administration addresses these legal challenges, Congress must seize this opportunity to legislate the President’s bold vision. Passing legislation to codify the universal 10% tariff would not only secure critical revenue to offset our unsustainable national debt and deficit, but it would also reaffirm America’s commitment to reshoring domestic industries and protecting our economic sovereignty. Without immediate action, Congress will hand China a $10+ billion refund and a receipt for American surrender. Tariffs remain the most strategic tool we have to revitalize American manufacturing, and it’s time for Congress to act.”
CPA Industry Analyst Kenneth Rapoza also recommended that Congress “remove China’s most favored nation status…[which] would immediately put China in the roughly 30% baseline tariff range. The existing Section 301 tariffs, first imposed by Trump in 2018 and extended for four years by the Biden administration in 2024, will stack on top of those, keeping China tariffs at 55%.”
I agree with the recommendation to revoke China’s most favored nation status, as I wrote about in my blog article of June 2024, titled “Why We Must Revoke China’s Most Favored Nation Status.” However, if the tariffs on Chinese imports are only temporary and at only a 30-55%% level, they won’t have the lasting effect needed to rebuild America’s industrial base. In my opinion, the tariffs on China need to be made permanent at a high level (100-125%) to influence CEOs of American companies to decide to reshore manufacturing to America, expand existing plants, and/or build plants in new locations. This action would truly set the stage to Make America Great Again.