The Future of Economy: USA Trade Wars
- ayouthviewpoint
- Feb 24
- 3 min read
By Javier Estremera
As the new Trump Administration takes office, various countries around the world fear for the change that the new president could bring to the global economy. Various countries are shocked by the fact that they are targeted by Trump's tariffs rather than only China, that was what he had previously established as the main "threat". Countries like Canada, Mexico, and the members of the European Union, went into panic when Trump announced more than 10% tariffs on their countries. Tariffs have been implemented since the 1600’s when countries wanted to expand and develop their national markets, particularly in the industrial sector. A tariff is a tax imposed on foreign goods, which companies are required to pay if they wish to export their products to the nations.
While the reasons to implement tariffs are not necessarily bad, the effects of these tariffs worsen the economic situation of the citizens. The reason that tariffs increase the country's industrial sector, comes from the price increase the companies impose. When a company pays for the tariff they simply increase the price of their product moving the tariff price to the consumer. This is intentional as the price increase is supposed to be an incentive for American consumers to purchase their products from American businesses.
Before entering office, Donald Trump had primarily focused his policy against the People's Republic of China. With China currently being the worlds biggest exporter, the United States needs to formulate a concrete strategy to surpass the country's massive exportation capabilities. This was the primary narrative that Trump used both in his first presidency and is one of the main for his second term. However, the People Republic of China would not be the only country that would receive these tariffs. On February 1st 2025 the White House sent a Fact Sheet declaring that the United States will begin to impose taxes on China (the known target) but also Canada and Mexico, unexpected targets since both countries are on good terms with the North American Free Trade Agreement.
Since Trump’s first presidency, the fight against illegal immigration and fentanyl has always maintained a top priority. The Trump administration has already made several actions to combat the entrance of these harmful materials. However, Trump believes that the Mexican government has been playing a part in this issue and that they are assisting both illegal immigrants and fentanyl, arguing that the Mexican government has a direct alliance with drug cartels. Further pushing the narrative that Mexico is the source of Fentanyl in the USA and are also responsible for the immigrant crisis. The narrative doesn’t conclude here, because according to the Trump administration there is another factor that has been helping Mexico with these operations from the shadows.
In a document published by the "White House" it was revealed that tariffs were established on Mexican products, additionally taxes have been implemented on Canada. There are multiple reasons that the Trump administration has placed these tariffs. The first reason is their “collaboration” with Mexico. According to the White House press, Canada has fentanyl labs that produce the drug in mass quantities, that then Mexican cartels transport into the USA. Secondly, Trump claims that the trade agreements established between Canada, Mexico, and the US have been horrendous and extremely one sided against the United States of America. However, the trade agreement he is referring to is the North American Free Trade Agreement (NAFTA), the same one that he signed. Lastly, Trump wants Canada to become the 51st state. While the Prime Minister already stated that Canada will not become a part of the US, Trump firmly believes that they need to be incorporated and because they refused to, tariffs will be placed.
There is no sign that the United States will not remove these tariffs as Trump's political platform has been held up by these various statements and goals. While Trump has implemented tariffs on other countries with these same tariffs being removed a couple of days later, all signs show these changes staying until the end of his presidency. Will they end? Only time will tell.
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