by Kent Jones, Professor Emeritus of Economics, Babson College
President Donald Trump’s tariff announcements no longer cause the market gyrations that they did in 2025. But their sticker shock for American consumers is becoming increasingly clear — just as economic sentiment is souring ahead of the November 2026 midterm elections.
Many business groups had hoped that the tariff wars would end in February, when the Supreme Court overturned Trump’s emergency tariffs. They got a rude awakening five months later, however, when Trump announced a raft of new import taxes to replace the levies that were struck down.
Covering nearly all U.S. imports, the advantage of these tariffs in the Trump administration’s view is that they’re more firmly based on existing U.S. trade law, beyond the reach of the Supreme Court’s review. And Trump has said he envisions enacting many more of these so-called trade law tariffs.
As a trade economist who has been following the tariff wars, I believe that the longer these import taxes are in place, the more the consumers will bear their burden. The 2025 “Liberation Day” tariffs that the Supreme Court struck down, as well as other levies Trump announced after the February ruling, turned out to be temporary. But the bulk of the new levies are designed to be permanent — meaning that for consumers, the total cost burden is likely to increase even if the tariff rates don’t change, because the new tariffs will be stacked on older ones.
On one level, Trump’s tariff fixation is a mystery. Tariffs continue to be unpopular, and it’s unclear why Trump would double down on them before midterm elections when his approval ratings, including on the economy, are so low. But on another level, Trump’s embrace of tariffs can be understood as an instrument of personal power — he has long viewed them as tools for negotiating leverage.
Trump based his July tariff announcements on three different legal justifications: a country’s unfair trade practices, like forced labor, known as Section 301; national security protection, or Section 232; and discrimination against U.S. imports, or Section 338, a trade war tariff dating to the Smoot-Hawley Tariff Act of 1930.
The new Section 301 tariff rates, which are global, currently range from 10% to 12.5%, but they could go up at the president’s discretion. Section 301 has also opened the door to new country-specific tariffs targeted at Brazil, at 25%, while Section 338 was cited to slap an extra 50% import tax on certain Canadian goods. In addition, Trump has imposed levies ranging from 25% to 50% for specific products, covering steel, aluminum, automobiles, copper, timber, lumber and pharmaceuticals. Yet more new tariffs are planned for wind turbines, personal protective and medical equipment, robotics, machinery and coal.
Trump is especially interested in Section 301, which is meant to remedy foreign trade practices that are discriminatory, unfair or unreasonable, and that burden U.S. commerce. It sets no limit on tariff rates and lets the president discriminate among exporting countries. Trump’s administration used this measure to punish virtually all U.S. trading partners on grounds that they failed to prevent imports made with forced labor, based on its own investigation determining the U.S. is the only country that prevents such imports. These tariffs were set at 12.5% for countries without any formal prohibition on forced labor imports, and 10% for all other countries with such a prohibition — similar in scope and impact to the earlier Liberation Day tariffs.
Twenty-five U.S. states have challenged these tariffs, alleging they go far beyond the original purpose of Section 301, which is to open specific markets to U.S. exports through negotiated policy reforms, not to impose global tariffs with no clear goal in sight. Whether this legal challenge will succeed depends in part on whether judges will continue to defer to the president on these particular levies, no matter how much they deviate from previous practice. I believe Trump is counting on it.
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