Yet tariffs are President Trump’s chosen prescription as he takes on America’s largest trading partners in a battle that could have broad consequences for American companies, farmers, and consumers—not to mention the entire global economy. Each of the countries Trump has targeted so far has retaliated with its own tariffs on U.S. imports. And those measures have specifically targeted U.S. industries in politically consequential states. What follows is a list of the major fronts in Trump’s ongoing trade war, and the blows struck so far:
Last month, Trump threatened 25 percent tariffs on $50 billion worth of Chinese goods in hopes, he said, of “preventing further unfair transfers of American technology and intellectual property to China, which will protect American jobs.” That $50 billion amount was split into two rounds: $34 billion that went into effect Friday and $16 billion at a later date.
The U.S. tariffs target Chinese imports of machinery, auto parts, and medical devices. For now, these tariffs won’t have much of an impact on consumers; they will affect manufacturers who will have to pay a higher price for imports of, for example, components needed in automobiles.
But that could change—quickly. Days after announcing last month that he would target $50 billion worth of Chinese goods, Trump threatened a further $400 billion of Chinese imports with tariffs. That is nearly the total amount of goods the U.S., the world’s largest economy, buys from China, the world’s second-largest economy.
The U.S. hopes that by threatening China, its second-largest trading partner after the EU, it can persuade the Chinese government to come to some sort of agreement with the Trump administration on trade. After all, China bought $115.6 billion worth of U.S. goods in 2016, according to the United States Trade Representative. That means that Beijing can impose proportional tariffs on U.S. imports for only so long.
But the Chinese tariffs are being directed at some of the largest U.S. sectors, including agriculture. Soybeans, SUVs, and whiskey are specifically being targeted. One soybean farmer told The Wall Street Journal he was already losing money—tariff fears have driven down the price of soybeans to such an extent that he told the paper $100,000 of the value of his crop had “disappeared into thin air.”’ The U.S. exported $20 billion worth of agricultural products to China last year; more than half of that amount came from soybean sales. In the lead-up to Friday’s retaliatory tariffs, which would make U.S. soybeans more expensive within China, Chinese companies had begun turning to Brazil for their supplies.
Unless the two sides come to an agreement quickly, other major U.S. industries, including pork producers, who rely heavily on Chinese demand, will lose billions of dollars when China carries out its threat to target the U.S. pork industry for tariffs.