What happened in the White House Rose Garden on Wednesday afternoon can’t be underestimated, an undeniable shot heard throughout the world of global trade. President Donald Trump imposed a nearly universal 10% tax on most foreign products entering the United States, and in so doing ended the era of free trade.
The legacy of Trump’s gamble won’t be written in the first few weeks after the imposition of these new and historic tariffs – though legacy news media will try to gauge it through the certain volatility of investment markets in the next few weeks.
In his announcement Wednesday afternoon, Trump made clear he had no qualms ending the era of free trade and replacing it with an era of fair trade – fair to America that is.
“Now it’s our turn to prosper, and in so doing, use trillions and trillions of dollars to reduce our taxes and pay down our national debt,” Trump declared.
Trump’s gambit closely mirrors Ronald Reagan’s bet on national security a half century ago when the 40th president used a military buildup and assertive foreign policy to economically and politically bankrupt the Soviet Union and end the Cold War.
That strategy became known as “peace through strength.” Trump’s plan – validated in advance by the Americans who voted for him in November, knowing he would impose tariffs – aims to prove that prosperity can be achieved through similar aggression, toughness and strength.