Introduction
The article will examine the background, expectations, effects of the tariffs, and political fallout imposed by the White House which appear to be a retread of the policy it had in its previous administration. Whether they will make any difference, especially with their hammered down followed by a hasty retreat, may somehow be intuitively grasped from what's in the content of this report.
(Image credit:
https://www.vermonttradewinds.com/news/post/the-barrel-aged-maple-syrup-revolution.html)
Methodology
Capsules contain synthetic intelligence queries enclosed in (Begin Perplexity-AI) and (End Perplexity-AI). The Congressional Record contains lengthy testimony from Senator Peter Welch of Vermont over the need for open trade with Canada. Followed by Notes, the paper is concluded with an Afterword and some insight on what the future holds in the trade agreement, or rather disagreement.
Capsules
(Begin Perplexity-AI)
explain the white house tariff plan
The White House has announced a "Fair and Reciprocal Plan" on trade, which aims to address longstanding imbalances in international trade relationships3. The plan involves imposing reciprocal tariffs on U.S. trading partners, meaning the U.S. will levy tariffs equal to those that foreign countries have set against American goods2.
Key aspects of the tariff plan include:
A 25% tariff on all steel and aluminum imports, which went into effect on March 12, 202514.
A 20% tariff on Chinese imports, increased from an initial 10% tariff imposed in early February4.
25% tariffs on Canada and Mexico, which took effect on March 4, 2025, with a one-month exemption for U.S. automakers1.
Potential tariffs on European Union goods, including a threatened 200% tariff on European wines, champagnes, and alcoholic beverages5.
The plan aims to correct trade imbalances, reduce the U.S. trade deficit, and improve American competitiveness across various industries3. President Trump has stated that while prices might initially increase, they are expected to decrease in the long run2.
In response to these tariffs, several countries have announced retaliatory measures:
The European Union plans to impose tariffs on $28 billion worth of U.S. goods1.
Canada has imposed tariffs on $30 billion worth of U.S. goods and plans to set 25% tariffs on $155 billion worth of imported U.S. goods1.
China has announced 15% tariffs on U.S. agricultural products4.
The White House argues that this plan will put American workers first, improve U.S. competitiveness, and bolster economic and national security3. However, the implementation of these tariffs has led to increased trade tensions with multiple countries and potential economic repercussions for both businesses and consumers.
https://www.perplexity.ai/search/explain-the-white-house-tariff-lWYLOMm0QTWfwZWOGq.iLA
the white house tariff plan will do little to help reduce government debt
The White House's tariff plan is unlikely to significantly reduce government debt for several reasons:
Limited revenue impact: While the tariffs are expected to generate substantial revenue, estimated at $2.8 trillion over 10 years, this amount falls far short of addressing the current $28 trillion public debt or the projected $50 trillion debt by 20344.
Insufficient deficit reduction: The tariffs would only lower the annual deficit by about $200 billion, or roughly 10% of the projected $2 trillion deficit for 20254. This reduction is minimal compared to the scale of the debt problem.
Competing priorities: The Trump administration has proposed using tariff revenues for various initiatives, including tax cuts, child care programs, and creating a sovereign wealth fund4. Allocating funds to these programs would leave little, if any, for debt reduction.
Debt service constraints: The administration has limited ability to reduce debt service payments, which accounted for 13% of the budget last year, without risking default6.
Overall fiscal impact: The Committee for a Responsible Federal Budget estimates that Trump's campaign proposals would actually increase the federal debt by $7.5 trillion over the next decade4.
In conclusion, while the tariff plan may generate revenue, its impact on reducing government debt is likely to be minimal due to competing priorities and the sheer scale of the existing debt.
https://www.perplexity.ai/search/the-white-house-tariff-plan-wi-7towqV1YSpWQZD5AcfI5vQ
the white house tariff strategy is more a trade vendetta than effective debt reduction plan
The White House tariff strategy under President Trump appears to be more focused on restructuring economic relationships and addressing perceived trade imbalances than on effective debt reduction. The strategy involves a series of escalating tariffs and trade conflicts with multiple countries, particularly Canada, Mexico, and China.
Trump's approach includes:
Imposing a 25% tariff on steel and aluminum imports from all nations, with initial plans to double it to 50% for Canadian imports12.
Implementing a 10% tariff on Chinese imports, which was later increased to 20%2.
Threatening tariffs on European Union goods2.
Adjusting tariffs on Canada and Mexico to 25% for goods not satisfying USMCA rules of origin, and 10% on certain energy products and potash5.
The strategy seems to be driven by several factors:
National Security Concerns: Trump is using Section 232 of the Trade Expansion Act of 1962 to justify tariffs on steel and aluminum as a measure to protect national security6.
Addressing Trade Imbalances: The administration views tariffs as a tool to revitalize domestic manufacturing and reduce trade deficits4.
Leverage in Negotiations: Tariffs are being used as bargaining chips to pressure other countries into making concessions on various issues, including border security and drug trafficking15.
However, this approach carries significant economic risks:
Potential Inflation: The tariffs could lead to higher prices for U.S. consumers, contradicting Trump's campaign promise to combat inflation4.
Retaliation from Trading Partners: Other countries have responded with their own tariffs, potentially sparking a "spiraling trade war"4.
Economic disruption: The tariffs could hinder economic growth and affect industries reliant on global supply chains4.
While the strategy aims to protect American industries and workers, economists warn that it may have unintended consequences. The focus on tariffs and trade conflicts suggests that the primary goal is reshaping economic relationships rather than debt reduction. The potential economic costs and disruptions indicate that this approach may be more of a trade vendetta than an effective plan for addressing national debt or long-term economic stability.
https://www.perplexity.ai/search/the-white-house-tariff-strateg-BZMiIL.cQQ62l696uxPH7g
u.s. tariff policies that have significantly failed and why
Several U.S. tariff policies have significantly failed, with negative consequences for the economy and job market:
Trump's Tariffs (2018-2025)
Donald Trump's tariff policies, implemented from 2018 and continued into 2025, have been widely criticized for their negative impact:
Job losses: A study commissioned by the U.S.-China Business Council found that Trump's trade policies cost the United States 245,000 jobs1.
Increased trade deficits: Despite aims to reduce trade imbalances, American deficits with China and the rest of the world were higher during Trump's presidency than under Barack Obama1.
Economic harm: The damage inflicted on the U.S. economy from Trump's initial tariffs was "clearly" "many times" greater than the wages of the jobs created2.
Retaliatory measures: U.S. trade partners implemented retaliatory tariffs, affecting U.S. exports and causing further economic strain2.
Smoot-Hawley Tariff Act (1930)
The Smoot-Hawley Tariff Act, implemented during the Great Depression, is considered a major policy failure:
Exacerbated economic crisis: Some experts argue that these tariffs contributed to worsening the Great Depression3.
Diminished global trade: The act led to greatly reduced international trade, harming the global economy5.
Retaliation: Other countries imposed retaliatory tariffs, further damaging U.S. exports and economic recovery5.
Why These Policies Failed
Outdated economic understanding: Trump's approach to trade was based on obsolete ideas about how trade works and ignored fundamental sources of U.S. trade imbalances1.
Collateral damage: Tariffs are a "blunt instrument" that cause widespread economic harm beyond their intended targets2.
Increased costs: Tariffs effectively act as a tax on U.S. consumers and businesses, raising prices and reducing competitiveness2.
Global economic integration: Modern supply chains are highly integrated across borders, making tariffs more disruptive than in the past5.
Political rather than economic focus: Trump's tariffs succeeded politically in certain regions but failed economically, highlighting a disconnect between political rhetoric and economic reality4.
In conclusion, these tariff policies failed because they did not account for the complexities of modern global trade, often caused more economic harm than benefit, and triggered retaliatory measures that further damaged U.S. economic interests.
https://www.perplexity.ai/search/u-s-tariff-policies-that-have-6vh10aykSDupbW1kiONgdg
smoot-hawley tariffs
The Smoot-Hawley Tariff Act, officially known as the United States Tariff Act of 1930, was a significant piece of legislation that raised import duties on foreign goods entering the United States12. Sponsored by Senator Reed Smoot of Utah and Representative Willis Hawley of Oregon, the act was signed into law by President Herbert Hoover on June 17, 193024.
Key Features and Impact
Tariff Increases: The act raised tariffs on over 20,000 imported goods, increasing the average tariff on dutiable imports from 40% to 47%12.
Scope: Initially intended to protect American farmers, the act's scope expanded to cover a wide range of manufactured goods, affecting approximately 25% of all imports into the U.S.15.
Economic Consequences: The Smoot-Hawley Tariff Act is widely blamed for exacerbating the Great Depression2. It triggered a trade war, with at least nine countries imposing retaliatory tariffs on U.S. products1.
Global Trade Impact: The act led to a collapse in global trade, with U.S. exports to retaliating nations declining by 28% to 32%1.
The act was passed despite opposition from over 1,000 economists who urged President Hoover to veto it24.
It passed the Senate by a narrow margin of 44 to 42 but sailed through the House of Representatives with a vote of 222 to 1532.
The official U.S. Senate website describes the Smoot-Hawley Tariff Act as "among the most catastrophic acts in congressional history"2.
The Smoot-Hawley Tariff Act marked the end of high tariffs in 20th century American trade policy8. Its disastrous effects led to a shift in U.S. trade policy, with subsequent administrations working to reduce tariffs and promote free trade12
https://www.perplexity.ai/search/smoot-hawley-tariffs-Ysq6F3jARGKrkapnOy2OXw
nations and imports targeted by smoot-hawley
The Smoot-Hawley Tariff Act of 1930 significantly impacted international trade by raising tariffs on a wide range of imported goods. Here are the key details about the nations and imports targeted:
Targeted Imports
The act raised tariffs on approximately 20,000 imported goods47.
It increased import duties by an average of 40% to 60%3.
The tariffs covered about 800 to 900 distinct product categories2.
Agricultural imports were a primary target, as the act initially aimed to protect American farmers3.
The legislation expanded to affect all economic sectors, not just agriculture2.
Nations Affected and Their Responses
Over 25 countries responded by increasing their own tariffs on American goods4.
Nine countries, including Argentina, Canada, and France, imposed retaliatory tariffs specifically targeting U.S. products2.
Canada, heavily reliant on the U.S. market, responded almost immediately with tariffs that significantly impacted American exports2.
France and Spain specifically targeted imported American automobiles with new taxes6.
In total, 35 nations lodged formal protests against the Smoot-Hawley Tariff Act2.
Impacts on Trade
Countries that retaliated reduced their imports from the United States by an average of 28-32%12.
Nations that officially protested but did not impose retaliatory tariffs still reduced their U.S. imports by 15-23%12.
U.S. imports from and exports to Europe fell by approximately two-thirds between 1929 and 19325.
Global trade declined significantly in the four years following the legislation5.
The Smoot-Hawley Tariff Act ultimately sparked a trade war, with many countries forming trade alliances that excluded the United States, leading to a collapse in global trade and exacerbating the Great Depression2.
https://www.perplexity.ai/search/nations-and-imports-targeted-b-czbUVCsuSFavl5l4DkifXw
states most likely impacted by trade tariffs
Based on the recent implementation of tariffs by President Trump on imports from Canada, Mexico, and China, several states are likely to be significantly impacted. The effects will vary depending on each state's trade relationships and economic structure.
Most Affected States
Montana: 94.3% of imports come from Canada, Mexico, and China2
New Mexico: 76.9% of imports from these countries2
Vermont: 75% of imports from these countries2
Idaho, Illinois, and Indiana are also likely to be significantly affected4
Proximity to northern and southern borders1
Reliance on Canadian energy imports (e.g., Illinois imports large amounts of Canadian crude oil)1
Composition of current trade based on existing company-to-company relationships1
Potential 0.4% GDP loss for the U.S., amounting to over $100 billion3
Increased costs for businesses, potentially leading to higher prices for consumers3
Disruption of supply chains4
Possible retaliation from affected countries, impacting U.S. exports3
It's important to note that the full impact of these tariffs may vary as trade patterns adjust and negotiations continue between the U.S. and its trading partners.
https://www.perplexity.ai/search/states-most-likely-impacted-by-GZ8tbKaRSJO4grjnzKDagA
(End Perplexity-AI)
Congressional Record
TARIFFS (Senate, 12 March 2025, S1693-94)
https://www.congress.gov/119/crec/2025/03/12/171/47/CREC-2025-03-12-pt1-PgS1693.pdf
The PRESIDING OFFICER (Mr. SCHMITT). The Senator from Vermont.
Mr. (Peter) WELCH (D-VT). Mr. President, I want to speak about the reckless tariffs that the Trump administration, Donald Trump, is inflicting on the American consumer, the American worker, American businesses—especially with respect to Canada.
Canada is Vermont’s largest trading partner. We are not alone. Thirty-four
States count Canada as its largest trading partner. We regard Canada as an independent friend, not as a prospective 51st State. And the reason we have that view toward Canada is because of the incredibly constructive and positive relationships we have had with that wonderful country for years.
But with respect to these tariffs, last year, trade with Canada accounted for 35 percent of Vermont exports and 67 percent of our imports and 56 percent of our total trade. One in four businesses in Vermont relies on trade with Canada. Vermont’s economy is almost entirely made up of small businesses. They operate on the tightest of margins. Ninety-nine percent of Vermont’s businesses, 76,878, are considered small. They support 60 percent of Vermont employees, that is 156,000, and these businesses cannot—they cannot—afford to absorb a 25-percent hike on imports from our largest trading partner.
Take maple syrup, for example. Vermont produces 51 percent of the maple syrup consumed in the United States. And by the way, these are small farmers or small land owners. For farmers, it supplements their income in a very difficult margin business when they are having a dairy operation as well. But Vermont's maple
syrup industry expects millions of dollars in losses if the tariffs go through.
And that may surprise some, but Vermont imports $408 million in maple products, primarily maple syrup, from Canada, and we reprocess it and sell it. The four largest maple syrup equipment manufacturers are located in Canada. Tariffs will make it far more expensive for our Vermont sugar producers, maple sugar producers, to buy that equipment.
This is an industry that has grown almost 500 percent in production over the past 20 years, and we are about to let all of that growth go down the drain with these reckless tariffs.
Vermont’s maple syrup producers are also concerned that the loss in market share will result in people turning to other products instead of Vermont’s liquid gold, with customers possibly turning to far inferior but more affordable products like corn syrup or agave if the price of syrup is too high.
These tariffs will also smash our farmers. Vermont farmers rely on organic grains and seeds and fertilizers that are imported from Canada. In that respect, all of our States on the northern tier are especially connected to potash and grains from Canada. And Trump’s tariffs will raise prices on fertilizers, grains, and seeds, on lumber products, and machinery equipment from Canada that Vermont farmers rely on.
And, understandably, Canada—as are other countries that are subject to the Trump tariffs—is imposing retaliatory tariffs on the United States, and that includes, of course, Vermont. That is going to make our sales much more difficult. Nearly half of the farmers polled in February said U.S. agricultural tariffs would result in the decrease in exports.
And, of course, we saw that that happened big time in the first Trump administration, particularly hammering our Midwest grain and soybean farmers. Those markets have not come back. The markets now are for Argentina and Brazil. What is the point of our own government doing something that so hurts our farmers for no benefit for the United States? This was a bad deal for our farmers during the first Trump administration.
And a USDA study from 2022 found that retaliatory tariffs led to a significant reduction in U.S. agricultural exports to the retaliating partners. The study found that export losses from 2018 to 2019 amounted to more than $27 billion.
And if you remember what happened then is, Trump wanted to get right with the farmers so he took away their market, $27 billion in sales, and then went to the taxpayer to make up the difference for those farmers. Every farmer I know, they would rather be selling what they grow rather than getting a government Trump subsidy.
The tariffs are also going to hurt consumers. There is no question about that. Grocery prices will be up. The price of eggs is up 19 percent from the end of the year and could climb to 41 percent this year. Meanwhile, the President is reposting articles on social media telling people to shut up—shut up about the price of eggs. Did he talk about anything else during his campaign? His tariffs on Canada, Mexico, and China would directly cost the typical U.S. household over $1,200 in purchasing power. And people in Vermont—and I know in your State, Mr. President—they are struggling at the end of the month to make that checkbook balance. They can’t afford that $1,200 hit. And some economists are estimating it could be an increase as much as 3,900 for the average American household.
Jobs and homes, the trade war could cost 400,000 good-paying, blue-collar jobs. The trade war will increase the cost of a home. You know, in Vermont we have a wood products industry. We export timber to Canada. It is milled in Canada, reimported to the United States, to Vermont, to help us build homes. A 25-percent increase on that imported lumber is going to go straight to the cost of an already unaffordable home. What sense does that make?
Trump’s tariffs will raise gas prices for us in Vermont 25 to 40 cents a gallon. We get a lot of our petroleum products from Canada.
It is going to cost more in home heating fuel, and that is a tough expense for Vermonters. And it is going to cost more in electricity. We, for years, imported electricity from Hydro-Quebec and other sources of power in Canada. So folks who have high electric bills, they are going to get higher; who are paying more than
they can afford for gas, they are going to pay more; and that home heating bill is going to hammer them once again—all for no constructive, positive reason.
You know, there is another aspect to this. It is not just the tariffs in our argument about the policy and the bizarre assertion that the Trump administration is making that these tariffs will make us rich, everybody knows— except, apparently, President Trump— that the people who pay the tariffs are the people who buy the products. You have a Canadian product that you have to, as a manufacturer, pay a tariff. That has to be added onto the price of the product—let’s say to the sugarmaker, that farmer who is paying it. There is a price on electricity, a tariff. The consumer is going to pay that. We all know that.
But aside from that, it is so chaotic, so disorganized, so hit-or-miss, so random in the rollout of these tariffs: on again, off again, on again, 25 percent, 50 percent, 10 percent. It is like the President wakes up and throws something at a dart board, and that is the new policy for the day. You cannot have an orderly expectation for your business. You cannot have the confidence that a consumer needs who is trying to really pay close attention to how she is spending the family budget with chaos. You can’t do it, and you don’t need it.
So why in the world is the President doing it? He seems to think chaos is a good policy.
You know what we saw—and we are seeing—and it is getting worse and it is not going to stop. The stock market had its worst week in 6 months. What does Donald Trump say? The stock markets are literally crashing. There was no reason for this, all self-inflicted. He said that in 2022. He is right today. It is all self-inflicted. The last 72 hours we have seen a wild ride.
And Trump is ready to send the United States into a recession in order to implement his disastrous economic agenda, and that boastful confidence that he always asserts: Everything is going to work out. It is going to be beautiful. He is saying: A recession, who knows, we may have to pay that as a price.
Well, you know what. We don’t have to pay that as a price for foolish policies that only hurt us and hurt our allies.
Nearly half of all U.S. imports, more than $1.3 trillion, come from Canada, China, and Mexico.
And it is estimated that Trump’s tariffs could reduce overall U.S. imports by 15 percent as well as increase prices. And Trump’s last attempt at a trade war was passed on entirely to U.S. importers and consumers, leading to a loss of 245,000 U.S. jobs and higher consumer prices. And I note that the unemployment rate ticked up last week.
Trump’s stated goal is using tariffs to achieve unrelated goals of curbing fentanyl—we all want to do that—and illegal immigration. We all want a secure border. But the southern border has about 1,000 times the amount of fentanyl that comes through the miniscule amount on the northern border. So what the President has is this indiscriminate policy where he is using—I would say abusing—the delegation of national security powers by this Congress decades ago, when it was expected that they would be used for a real national security military threat, to meet his whims to negotiate this way and that on whatever strikes his fancy that particular day.
And I also note that in the House bill that has been sent over here, the continuing resolution, the House has included a provision that can only be described as outrageous and cowardly. It said—the House stripped itself of the authority to vote on these tariffs that have been invoked by Trump’s emergency authority.
How can a legislative body do that, literally vote to say we can’t vote on whether we believe that these tariffs have any merit or are going to be good or bad for the people we represent? The House did that, and that is in the CR.
We have got a long history with tariffs. And we saw in the 1930s, the Smoot-Hawley tariffs led to a trade war, led to a depression, hurt jobs, hurt consumers. It is really, really stupid.
This is going to hurt Vermont. I call on all of us to speak out against these tariffs that are going to hurt us in every State of this United States of America.
I yield the floor.
(End Congressional Record)
Notes
(Begin Perplexity-AI)
no evidence current tariffs will have same outcome as smoot-hawley
While there are similarities between President Trump's proposed tariffs and the Smoot-Hawley Tariff Act of the 1930s, it's important to note that the current global economic landscape is significantly different, which may lead to different outcomes.
Key Differences
Economic Integration: Today's global economy is much more integrated than it was in the 1930s, with complex cross-border supply and value chains. This interconnectedness may mitigate some of the negative impacts of tariffs.
Strategic Use: Unlike the Smoot-Hawley Act, which aimed to protect local economies, Trump is using tariffs as a "weapon of power" and a bargaining chip in non-trade issues such as immigration, currency dominance, and geopolitics.
Economic Strength: The U.S. is inheriting a strong, well-grounded economy from the Biden administration, which may provide a buffer against potential negative effects of tariffs.
Global Economic Landscape: The world economy has evolved significantly since the 1930s, with different trade relationships, international institutions, and economic policies in place.
Potential Impacts
While the outcomes may not be as severe as those of Smoot-Hawley, there are still potential consequences to consider:
Inflationary Pressure: The tariffs could lead to increased prices for American consumers and businesses.
Economic Growth: Proposed tariffs on Canada, China, and Mexico could potentially shrink U.S. economic growth by 0.4 percentage points.
Retaliation: Major trading partners have expressed intentions to retaliate, which could escalate into a trade dispute.
Manufacturing Challenges: The U.S. may face issues in advanced manufacturing due to labor shortages, especially amid immigration crackdowns.
While historical lessons from Smoot-Hawley are valuable, the unique characteristics of the current global economy and the strategic use of tariffs by the Trump administration suggest that the outcomes may not mirror those of the 1930s. However, caution is still warranted as trade disputes can have complex and far-reaching consequences.
https://www.perplexity.ai/search/no-evidence-current-tariffs-wi-c.zgNVP2ShuQTeO3LZTOOA
Afterword
Once again, the given tactic, as was noted in the Senator Schumer testimony over Social Security, that it's another tax the poor and let the rich off free, the same is used here, the current international response will somehow cause another Great Depression, as if America, like the pandemic, has fully recovered from the last one. In this case Smoot-Hawley are the scapegoats. Innumerable items are on the trade tariff list and may or may not mirror those from the 1930s, the base may have shifted from (possibly) agricultural to industrial. As was noted in "no evidence," the global supply chain is remarkably different and more advanced from 100 years ago. Nations are more willing to concede defeat, suffering minimal losses in the process. Political rhetoric and scaring the international marketplace may not have the impact it did in the '30s, when communication, especially fake, could not be ferreted out as rapidly as today.
Maybe Senator Welch from Vermont is correct. The usual grocery index lately has been based on the price of eggs, but blame the chickens, not the politicians. It's all about maple syrup.
Tags: #tariff, #Tradewar, #China, #Canada, #Mexico, #Smoot-Hawley,