Tariffs: the war Trump might actually win

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With the unpopular Iran war going badly, President Trump has launched a new offensive on his favorite battlefield: tariffs.

Trump’s undisciplined, improvisational style is less dangerous in a trade war than in a military conflict. He can issue demands, change targets and deadlines, and set his own victory terms without putting American soldiers’ lives on the line.

But the president’s new tariffs against more than 80 countries — including Canada, Mexico, and the entire European Union — carry their own economic and political risks as the high cost of living remains the top concern of voters.

What happened: The president last week ordered tariffs ranging from 10 percent to 12.5 percent to replace expiring duties that have been in place since February. Those earlier fees were imposed as a temporary stop-gap after the Supreme Court invalidated his 2025 “Liberation Day” tariffs.

The administration believes the new open-ended tariffs will withstand legal challenges.

Trump also imposed a new 50 percent tariff on a slate of Canadian imports, threatened a 100 percent levy on generic drugs, and said he would retaliate against the European Union after it fined Google more than $1 billion for illegal trade practices.

Why it matters: Higher energy costs caused by the war, an artificial intelligence-fueled demand boom that has pushed up prices for computers and electronics, and even more tariffs in the pipeline could stall the modest improvement in inflation since Trump returned to office.

Notably, his approval ratings for handling the economy are just as low as they are for his prosecution of the war, according to a Fox News poll released last week. That bodes poorly for Republicans in the November midterm elections.

The details: Trump ordered the latest tariffs using Section 301 of a 1974 trade law.

His Liberation Day action was based on another trade law, the International Emergency Economic Powers Act, which the Supreme Court said didn’t authorize the president to impose duties.

Section 301 is intended to punish other nations for trade policies the government determines discriminate against American businesses or violate international trade agreements.

In the past, Section 301 tariffs have usually been assessed on individual countries. But the administration said an investigation by the office of the United States Trade Representative found that all the countries targeted had failed to enact or enforce bans on importing goods produced with forced labor.

The probe didn’t, however, look at whether the countries were actually importing such products.

The reaction: Critics accused Trump of using the very serious issue of forced labor as a thin excuse to reimpose tariffs on virtually every US trading partner.

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Two small businesses have already sued to block the levies, claiming they are an illegal attempt to circumvent the high court’s ruling.

“Trump’s next trade scheme is ordering USTR to reconstruct his illegal global tariffs under the guise of addressing forced labor,” Democratic Senator Ron Wyden said Wednesday in congressional testimony.

In the same hearing, the US trade representative, Jamieson Greer, said that the administration was determined to expand tariffs regardless of the legal approach.

“The specific authorities this administration is using have changed, but the trade strategy has not,” he said.

By the numbers: Trump argues that America’s trading partners have used unfair policies to “rip off” the United States for years, and tariffs are the best tool to reduce the trade deficit, increase domestic manufacturing, and boost federal revenue.

Tariffs are a tax on American businesses and consumers in the form of higher prices paid on imports. An April study by Federal Reserve economists estimated that Trump’s second-term tariffs raised consumer goods prices by 3.1 percent through February. Since most spending is on services, the overall impact was lower — an increase of 0.8 percent.

Still, households are spending an extra $1,100 a year due to tariffs, according to the Budget Lab at Yale University.

The big picture: The effects of tariffs on the economy, both positive and negative, have been modest.

Growth has held up thanks to strong spending by consumers in the top 20 percent income bracket and the surge in AI-related corporate investment. Spending among the other 80 percent of households is flat.

Manufacturers have shed 75,000 jobs since the start of 2025 despite increasing their output. The trade deficit in goods has narrowed a bit this year.

Final thought: It’s really no surprise that Trump has found a way to get around the Supreme Court. At least for now.

If he has one core belief — beyond that the president should have limitless power — it is that tariffs will cure what ails American manufacturing.

Perhaps if Trump had spent as much time planning for regime change in Iran as he did creating a new US tariff regime, the war would be over by now.

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