In a history-making day of tariffs, President Trump imposed charges of at least 10 percent on nearly all of America’s trading partners.Ana Swanson, who covers trade for The Times, discusses who will be affected most and looks at how the levies effectively ended one era of global trade and began a new one.Guest: Ana Swanson, who covers trade and international economics for The New York Times.Background reading: The tariffs are likely to ripple through the global economy, driving up prices for American consumers and manufacturers while inciting retaliation from other nations.Mr. Trump says global trade is unfair. Does he have a point?Read about how the tariff rates are calculated.For more information on today’s episode, visit nytimes.com/thedaily. Transcripts of each episode will be made available by the next workday. Photo: Doug Mills/The New York Times Unlock full access to New York Times podcasts and explore everything from politics to pop culture. Subscribe today at nytimes.com/podcasts or on Apple Podcasts and Spotify.
Chapter 1: What are President Trump's new tariffs about?
From The New York Times, I'm Rachel Abrams. This is The Daily. In a history-making day of tariffs against dozens of countries, President Trump ended one era of global trade and began a new one. Today, my colleague Anna Swanson on how the world's economy is being upended and who will be affected most. It's Thursday, April 3rd. Hi, Anna. Hey, how are you? I'm good.
I'm really curious what your day has been like.
Well, it's been exciting. Liberation Day. That's right. We're here at 7.52 at night. Been a pretty full day.
So, Ana, obviously today has been incredibly busy, but really the news on the tariffs over the last few months has been totally head spinning and frankly kind of hard to follow. And we're speaking to you shortly after President Trump has come out to the Rose Garden and announced this expansive new plan. We all watched it here at The Daily, and there's a lot to get into.
But I just want to start off with, can you walk us up to this moment?
Yeah. So President Trump came into office promising to reorder the global trading system for the United States. And in the last few weeks and months, we've really seen him do that. He has announced sweeping tariffs on some of the country's biggest trading partners on Canada, on Mexico, on China. He's targeted different industries like automobiles and steel and aluminum.
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Chapter 2: Who are the target countries of the new tariffs?
And then today, he was going to come out with what he has described as his biggest measure yet.
Thank you very much. Thank you.
So at 4 p.m., Trump came out to the Rose Garden and he gave a speech.
For decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike.
He talked about how America had been cheated for decades.
Our country and its taxpayers have been ripped off for more than 50 years, but it is not going to happen anymore. It's not going to happen.
How now we're finally going to put the American worker first. and said that the global trading system hadn't worked for the United States and needed to be changed.
In a few moments, I will sign a historic executive order.
He announced two big types of tariffs. First, a universal tariff that will apply across the board to almost all trading partners, and then bigger reciprocal tariffs that go on top of that for countries that are bad actors in his eyes.
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Chapter 3: How significant are the new tariffs announced by Trump?
That means they do it to us and we do it to them. Very simple. Can't get any simpler than that.
And the measures that he's announced were much bigger than many people were expecting.
It's going to be Liberation Day in America, and it's going to be a day that hopefully you're going to look back in years to come and you're going to say, you know, he was right. This has turned out to be one of the most important days in the history of our country. God bless you and God bless America. Thank you, everybody. Thank you very much.
So let's dig into those measures for a second that he announced. Can you just explain them a bit more?
Yeah. So first, the president is imposing what he's calling a universal baseline tariff. And so this goes into effect on basically all trading partners except for Canada and Mexico. It's a 10 percent tariff that applies across the board.
And to be clear, that universal 10% tariff that you mentioned, that's going to be applied to some countries where there is currently no tariff at all, including some of our allies. Is that right?
Yeah, that's right. And then on top of that, there are additional tariffs on dozens of other countries in return for what the president is calling their unfair trade and economic practices against the United States.
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Chapter 4: What are the two types of tariffs introduced by Trump?
And by unfair, he means?
So by that, he means the tariffs that other countries are charging on American products, but also other barriers that they have to U.S. imports, other regulations that might make it harder for U.S. businesses or farmers to sell their products in those countries.
So in other words, he's sort of like, well, you have been unfair to us, so this is how we are going to get back at you. Exactly.
Exactly.
So during the speech, he held up this poster with kind of a big chart on it that tried to break down some of these numbers because there were a lot of countries, a lot of numbers. And the chart was supposed to help explain the calculations his administration made and how they came to it. Can you walk us through that a little bit?
So when he held up that chart, we immediately started taking pictures of it and sharing it around because the numbers were a mystery to everybody up until he walked into the Rose Garden. And some of the numbers are pretty big. So the chart said, for example, that the U.S. would impose an additional 34% tariff on Chinese goods.
That comes on top of a 20% tariff that the president has imposed on China in recent months.
Just to be clear, we're talking about a 54% tariff on Chinese goods. It sounds astronomical. That is a very large number.
Right. And these big tariffs don't just apply to countries like China. They apply to some of our allies, too. So there's also an additional 20% tariff that'll be charged on imports from the European Union and a 24% tariff that applies to goods from Japan.
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Chapter 5: What are the economic goals behind Trump's tariff strategy?
And then there was another camp that favored reciprocal tariffs. So these are tariffs that would be higher or lower based on other countries' trading practices, and which would really be used as a negotiating platform.
tactic to try to get those countries to lower the trade barriers that they have on the United States, lower their tariffs with the goal of having more trade and having more US exports. And so what Trump ended up announcing today was essentially a version of both.
So he decided to do this baseline tariff that will apply broadly to all imports, will raise revenue for the government, he believes will also help to reverse the trade deficit, and then higher reciprocal tariffs that are really more directed at what he calls unfair behavior by other countries against the United States.
So it sounds like from your description that the 10 percent is kind of here to stay, whereas the other one is more of a negotiating tool. And we might see that one kind of fluctuate.
Yeah, the White House said in a call today that they weren't in a hurry to negotiate with other countries and negotiate. that though some countries had dropped their tariff rates in the last 24 hours, they should have done that decades ago. But in the executive order laying out these tariffs that Trump signed today, it does say that if countries either reduce those trade barriers or the U.S.
trade deficit with them drops, then those tariffs could come down.
Can we just zoom out for a second? Because I kind of want to understand how the administration went about targeting these specific countries this way to begin with. Some countries are obviously being hit harder than others.
So the president said today in the Rose Garden that these numbers were calculated based on tariffs and tariffs. other trade practices that these countries use against the United States. But actually, when you look at the number, it seems like it's a simple calculation that's based on the size of the trade deficit that the United States runs with each of these countries.
So essentially, countries that have bigger trade deficits get hit with bigger tariff numbers. Right. But it's also notable who was left out of the tariffs today. The tariffs don't apply to Canada and Mexico.
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Chapter 6: How might Trump's tariffs affect global trade negotiations?
And the president has tried to kind of wave away those concerns about those tariffs, saying they're going to benefit workers, they're going to bring auto manufacturing and auto jobs back into the United States and benefit unions like the UAW, the auto workers.
Right. He even brought one of those UAW guys up on stage today during his speech. Like, he's really trying to emphasize that these policies are helping everyday Americans.
And the UIW has been one of the groups that actually has been very vocally in support of the tariffs, saying that they could reverse this disastrous trade policy and benefit workers. But a lot of other companies and unions and trade groups have expressed a lot more skepticism about how these tariffs are going to pan out.
We'll be right back.
Ana, every single time that Trump has announced or threatened tariffs since he took office, there has been a chorus of prominent, probably the most prominent economists who say, this will be bad for the economy. This will raise prices. This will be bad for consumers. And here again today, President Trump was saying, no, no, these tariffs will boost jobs and they'll make America wealthy again.
Yeah. So the president has a very different theory of how tariffs work than I think most economists do. The president thinks that tariffs bring factories back to the United States, that increases jobs for American workers, it pushes up wages, and that's good for the economy.
I think economists also think that those things happen, but they see a lot of other side effects happening from tariffs too, that in a lot of cases can offset those positive impacts from tariffs. So you did have today economists just racing to downgrade their forecasts for the US economy, lifting their expectations for inflation, saying that unemployment would rise as a result of this.
S&P Global saying that manufacturers were going to have to pay more for their inputs. So inflationary pressure would build as a result. So economists just see a lot of price increases from this. And then from that flows a slower economic growth, potential unemployment. So it's a very different picture of how tariffs impact the economy.
So if the economists are right, who is paying for all of this? Because just to emphasize here, these tariffs are enormous.
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