Photo via the Wall Street Journal
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Today, the U.S. is the top export market for China. This trade has allowed lower prices for American consumers since the stabilization of diplomatic relations in 1979, following their fallout during the Korean War. While cheap Chinese goods have allowed many Americans to enjoy a higher standard of living, the Chinese American trade deficit cost 3.7 million Americans their jobs between 2001 and 2018. Tariffs—taxes placed on goods that are brought into or sent out of a country—serve as more than just a way to raise government revenue; they are also strategic instruments used by countries to exert influence, shape trade agreements, and protect local industries. However, today they are being used to manipulate the American economy.
In 2001, China entered the World Trade Organization (WTO). To gain entry after applying in 1984, Beijing agreed to implement broad economic changes, such as significantly reducing tariffs on imports, strengthening intellectual property protections, and increasing openness about its legal and regulatory systems. When China joined the WTO, U.S. negotiators insisted on a temporary safeguard to restrict Chinese imports if necessary, but it was rarely utilized before it expired after twelve years. The Clinton administration hoped that China’s entrance to the WTO would foster increased democratic reform in China despite opposition from American labor unions. Trade grew dramatically as a result of China’s entrance into the WTO, with the value of U.S. imports of Chinese goods increasing from roughly $100 billion in 2001 to over $400 billion by 2023. Since 2001, China’s inflation-adjusted economy has expanded over five times its original size, making it the second-largest economy globally, just after the United States.
The first Trump administration imposed tariffs on $200 billion of Chinese imports in response to China’s unfair trade practices, initiating a trade war. In March 2018, the U.S. Trade Representative (USTR) released a detailed report from its Section 301 investigation, which concluded that China’s actions and policies on technological transfering, intellectual property, and innovation were unfair and harmful to U.S. trade. These higher U.S. tariffs reduced the profits of Chinese exporters, with a 1% rise in tariff-adjusted export prices leading to an average 0.35 percentage point decline in their profit margins. Beijing retaliated with tariffs on U.S. imports worth about $3 billion, including 15% duties on products including fruits, nuts, wine, and steel pipes. In January 2020, China agreed to buy $200 billion more in U.S. goods under the Phase One trade deal, but later research showed it fell far short of that goal.
As the 2024 election heated up, the Biden administration raised tariffs on Chinese electric vehicles, solar cells, steel, and aluminum during the heated election with Trump. One can infer that this move was an attempt to appear tough on China and appeal to working-class voters in key swing states affected by industrial decline. Republicans criticized the tariffs as too little, too late, arguing that Biden was merely copying Trump’s playbook without offering a clear long-term strategy. Meanwhile, many Democrats were divided: some supported the move as a way to protect American jobs and industries, while others worried it could strain international relations and increase costs for consumers.
Trump’s 2024 campaign elicited dramatic tariffs on Chinese goods, furthering his protectionist approach. On February 4th, 2025, new 10% tariffs on all Chinese imports to the U.S. came into effect. China retaliated the same day by announcing a flurry of countermeasures, including duties on American coal, liquefied natural gas, and agricultural machinery. An extra 10% tariff on all Chinese goods was put in place, and China hit back with up to 15% tariffs on major American farm exports like chicken, pork, soybeans, and beef.
Then, on April 3, 2025—what Trump called “Liberation Day”— a 34% tariff on all Chinese imports was announced, plus new tariffs on goods from many other countries, which came into effect on April 9th. The phrase “Liberation Day” is highly problematic for a multitude of reasons; it ignores the economic consequences of importers passing the costs to consumers, it alienates global partners, symbolizes a combative stance, and it politicizes trade policy.
In response, on April 4, China launched even stricter conditions for trade. It announced new restrictions on rare earth mineral exports, which are essential for high-tech manufacturing, filed a complaint with the WTO, and opened an anti-monopoly investigation into DuPont’s operations in China. China’s retaliation signals a strategic escalation, targeting sectors like rare earth minerals that are crucial to the U.S. tech and defense industries. Furthermore, filing a WTO complaint and investigating a major U.S. company, China is using both economic and legal tools to push back against U.S. pressure.
As the U.S.–China trade war continues to build, the long-term effects on the American economy remain foreboding. Prices for the average American are expected to go up, and global supply chains could suffer immensely. Tariffs are often framed as tools to protect domestic industries and stand up to unfair trade practices; however, Trump’s words and actions have only enhanced the risk of isolating the U.S. from allies and fueling a cycle of retaliation that could hurt American workers, especially in agriculture and manufacturing industries. Meanwhile, China is not backing down. The outlook is poor for American consumers, workers, and manufacturers alike.
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This article was edited by Kailee Pierce.
Thomas Tisdale 
David Tomanelli 
Sinhawe Haji