Economic nationalism has high domestic costs, even for those it aims to protect.
By Matthew A. McIntosh
Public Historian
Brewminate
Introduction
During Donald Trump’s presidency from 2017 to 2021—and resuming again in 2025—one of the most defining aspects of his economic agenda was an aggressive shift in U.S. trade policy. Grounded in an “America First” doctrine, Trump seeks to reduce trade deficits, revive American manufacturing, and decouple critical supply chains from adversarial nations. His administration has abandoned longstanding free-trade orthodoxy in favor of tariffs, bilateral deals, and trade wars, most notably with China. While these policies are framed as corrective tools to rebalance global trade, they produce a complex and often burdensome ripple effect—particularly for American importers.
Here I ask how Trump’s trade practices have affected U.S. importers across industries, examining the economic, logistical, and strategic consequences of a policy framework built on confrontation and protectionism.
The Return of Tariff-Centric Trade Policy
At the core of Trump’s trade practices is an aggressive use of tariffs as economic weapons. Under Section 301 of the Trade Act of 1974, the administration imposed sweeping tariffs on Chinese goods in retaliation for what it described as unfair trade practices—ranging from intellectual property theft to currency manipulation and forced technology transfers. The tariffs covered over $350 billion worth of Chinese imports by 2020.
Additionally, tariffs are levied under Section 232 of the Trade Expansion Act of 1962, justified on national security grounds. Steel and aluminum imports were targeted globally, affecting allies like Canada, the EU, and Japan, alongside China.
For American importers, this translated into immediate cost increases:
- Higher input costs for manufacturers and assemblers reliant on foreign components.
- Increased prices on finished goods for wholesalers and retailers.
- Supply chain disruption as companies scrambled to find alternative sources or renegotiate contracts.
Businesses that operated on narrow profit margins—such as small distributors and parts suppliers—were hit especially hard, often forced to either absorb costs, cut labor, or pass prices to consumers.
Strategic Reorientation and the China Trade War
The China tariffs were perhaps the most disruptive. China had long been a manufacturing hub due to its scale, infrastructure, and low costs. Trump’s tariffs aimed to decouple this dependency, but the transition was not smooth.
Importers faced a dilemma: pivot to other countries like Vietnam, India, or Mexico—which required time, capital, and sometimes a sacrifice in quality—or stay and pay the tariff premiums. Many larger corporations diversified, but smaller businesses lacked that flexibility.
In some cases, the cost of complying with new customs regulations—paperwork, inspections, country-of-origin tracing—became nearly as burdensome as the tariffs themselves. The uncertainty around what products might be added or removed from tariff lists created a climate of unpredictability, which is toxic for importers trying to manage inventory, pricing, and logistics.
The Trade Deficit Paradox
Despite Trump’s stated goal of reducing the U.S. trade deficit, it actually grew during his first term. The goods deficit with China initially declined due to reduced imports but soon widened again as U.S. firms scrambled to secure materials and goods from other countries—many of which simply imported Chinese components themselves.
This exposed a fundamental contradiction in Trump’s approach: while attempting to shield American industries, his policies often penalized them indirectly through increased costs on foreign inputs and retaliatory tariffs.
For example:
- U.S. automakers importing foreign steel saw price hikes.
- Consumer electronics firms, reliant on Chinese parts, experienced margin shrinkage.
- Agricultural importers—such as those dealing in foreign-grown produce not cultivated domestically—faced supply shortages and higher costs.
Importers as Collateral in Global Retaliation
Trump’s policies have also provoked retaliatory tariffs from affected countries, triggering a global trade backlash. While these were primarily aimed at American exporters, they indirectly harmed importers too:
- Logistical bottlenecks have emerged at ports as customs procedures became more complex.
- Global freight costs have increased, worsened by retaliatory inspections and added documentation.
- Supply chain timelines have lengthened as exporters abroad recalibrated their own strategies.
American importers dependent on goods from regions involved in retaliatory tit-for-tat moves have found themselves caught in geopolitical crossfire, often with little recourse.
Winners and Losers Among Importers
It would be misleading to paint all importers as losers under Trump’s policies. Some businesses did benefit—particularly those that re-shored operations or successfully transitioned to domestic sourcing in anticipation of tariffs. Others found arbitrage opportunities by sourcing from tariff-exempt countries or shifting logistics operations to avoid penalty thresholds.
Moreover, sectors that had been hollowed out by decades of offshoring (e.g., steel production) welcomed the breathing room provided by import restrictions. But these were the exception, not the rule.
The majority of U.S. importers, especially in industries such as consumer goods, textiles, electronics, and automotive parts, experienced increased complexity, higher costs, and financial strain.
Legal Challenges and Policy Pushback
Importers have mounted legal challenges against the Trump tariffs, questioning their scope and legality. Many businesses joined together in lawsuits, particularly over the later tranches of the Section 301 tariffs. Although courts have been slow to overturn these measures, the litigation underscored the widespread frustration among importers.
At the same time, industry lobbying intensified. Trade associations—from the National Retail Federation to the American Apparel & Footwear Association—warned that long-term uncertainty would lead to inflation, layoffs, and a retreat from global competitiveness.
The Post-2021 and Second-Term Landscape
Although President Biden retained many of the Trump-era tariffs, his administration adopted a more multilateral, stable tone. But with Trump back in office in 2025, early indications suggest a renewed push toward trade nationalism—including the floated idea of a universal 10% tariff on all imports. Such a policy would represent a radical broadening of trade restrictions and could pose a severe threat to American importers who already operate in a high-cost, low-margin global economy.
The consequences would likely include:
- An across-the-board inflationary effect on imported goods.
- Renewed global tensions with allies and adversaries alike.
- A further reduction in predictability, especially for small and mid-sized businesses.
Conclusion: Consequences in a Globalized World
Trump’s trade practices are designed to assert American strength and rebalance global trade relationships. Yet for U.S. importers, they have brought a storm of rising costs, uncertainty, and supply chain disruption. The policies, while popular with certain constituencies, overlook the deep entanglement of global markets and the interdependence of American businesses with foreign partners.
In an age where iPhones are assembled in China, cars rely on parts from five continents, and even small retail shops source globally, the Trump trade doctrine represents a powerful jolt to the system—a reminder that economic nationalism has high domestic costs, even for those it aims to protect. The future of American importing will depend on whether policymakers can reconcile protectionist instincts with global economic realities—or whether importers will be left to navigate a world shaped by politics, not commerce.
Originally published by Brewminate, 07.01.2025, under the terms of a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International license.
About the Author
