Reimagining American Economic Leadership |
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Dear RealEcon Readers,
President Donald Trump has made no secret of his fondness for tariffs. Less clear is what he sees as their main purpose: to create leverage with trading partners, to raise revenues, to protect U.S. industries, or to achieve some other objective. The president’s actions in his first two weeks in office put a spotlight on the first goal, as he threatened and then suspended 25 percent tariffs on Canada, Colombia, and Mexico, after winning marginal concessions from each. But it is early days, and there are almost certain to be further twists and turns in this story.
CFR fellows have been busy over the past two weeks covering the unfolding trade story. In this edition of RealEcon, we feature pieces by Greenberg Center fellows Edward Alden, Shannon K. O’Neil, and Benn Steil, as well as an explainer on tariffs and a short video on the International Economic Emergency Powers Act (IEEPA) featuring CFR Trade Policy Fellow Inu Manak. The RealEcon Initiative, and CFR more broadly, plans to put a new focus on trade issues in the period ahead, as you can see from the added module ("Latest on Trade") in this newsletter and on the RealEcon homepage.
Of course, we will also continue to cover other important issues in international economic policy, including the future of the U.S. Agency for International Development (USAID) and the latest in economic security policy; pieces on both, as well as on other issues tracked by Greenberg Center fellows, are featured below.
Thank you for your interest in the RealEcon Initiative. I value your feedback on this newsletter and your ideas for how the initiative can be more useful and impactful. —Matthew P. Goodman, Director of the Greenberg Center for Geoeconomic Studies and Director of the CFR RealEcon Initiative |
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The tariffs that Trump has announced against three of the United States’ biggest trading partners—Canada, China, and Mexico—look poised to shatter the era of a rules-based order with global economic ramifications, writes Alden. Read more
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If implemented, Trump’s tariffs on Canada, China, and Mexico could upend U.S. trade. These nine charts show what is at stake, what comes next, and why it matters, write O'Neil and Special Assistant and Research Associate to the Director of Studies Julia Huesa. Read more
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Trump has threatened new tariffs on all imports from Canada and Mexico. His trade plans threaten the future of the United States’ largest free trade agreement, write O'Neil and Huesa. Read more
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Nearly all of Trump’s first-term China tariff revenue went to compensate American farmers facing retaliatory tariffs. Expect a replay in 2025, write Steil and Greenberg Center analyst Elisabeth Harding. Read more
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CFR Trade Policy Fellow Inu Manak explains the IEEPA, an obscure law that provides sweeping economic powers to the U.S. president during an emergency and enabled Trump’s tariffs on trade partners.
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Trump has begun his second term with a raft of tariff threats to bolster his immigration priorities, support local industries, and compete with China. Writers Anshu Siripurapu and Noah Berman explain how those taxes work and how they have been used historically. Read more
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This time around, President Trump and Prime Minister of India Narendra Modi should seize the opportunity to strike a substantial bilateral agreement, write Distinguished Fellow Kenneth I. Juster and Senior Advisor at the U.S.-India Strategic Partnership Forum and the Asia Group Mark Linscott. Read more
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No matter how the review ends, this suspension of foreign assistance and its stop-work order has already caused lasting damage, writes former USAID Assistant Administrator Michael Schiffer. Read more
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Policymakers are rethinking old tools and creating new ones to address various concerns in order to strengthen economic security. The central point of tension between the United States and its trading partners, however, is resolving how to integrate economic security concerns into the trading system without destroying it, writes Manak. Read more
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