Trump's 25% Steel Tariffs: A Repeat of Past Economic Failures
Why History Shows Protectionist Policies Hurt American Jobs, Consumers, and Global Trade
Yesterday, February 9, 2025, President Donald Trump announced his intention to institute a 25% tariff on steel imports. A 25% tariff on steel imports means an additional 25% cost on the price of imported steel for American companies. This mentality aligns with his “America First” policy, hoping to promote domestic steel production over foreign imports.
We have done this type of thing in the past with Trump, Obama, Bush, etc. They all have put in this protectionist-style dynamic to manage trade, and it has never worked out well for Americans or those in the steel industry. For example, when Trump did this in 2018, it did nothing but increase costs to the U.S. consumer. It also leads to retaliatory tariffs from other affected countries, hurting our exports in other industries — hurting American business. Most people have lived through these times, yet are quick to cheer and defend these known failures of tariffs.
Tariffs almost always end up costing American jobs. Studies from the 2018 tariffs showed that for every job saved in the protected industries, multiple jobs were lost in industries that rely on these materials. The net effect on employment was often a net negative.
Additionally, this type of government intervention distorts markets and creates gross misallocation of resources while stagnating innovation. While on the surface, these types of measures sound great, they create division with other countries while contributing to inflation here at home. Instead, Trump and future presidents should embrace free trade over managed trade for a better America.
