The Issues
Tariffs and Unusual Trade Tools
A trade policy under the second Trump administration will continue the president-elect's first term's use of a wider and more diverse box of trade tools than almost any other president in modern history.
During his first administration, Trump implemented a range of trade measures under several disused executive tariff authorities. Trump instituted Safeguard Tariffs on solar cells, solar modules, washing machines, and washing machine parts and National Security Tariffs on aluminum and steel, in addition to imposing tariffs on a huge collection of goods from China beginning in 2018—the so-called Section 301 tariffs, which have carried over into the Biden administration.
Until Trump's first term as president, certain executive tariff authorities, such as Section 201 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962, had not been used since 2003 and 2001, respectively. The first Trump administration tariffed approximately $380 billion in goods in 2018 and 2019. Since announcing his 2024 campaign, Trump has made expansive claims about new tariffs for his second term. This includes a 25% to 75% tariff on goods from Mexico in response to Mexico's response to undocumented immigration, a 100% tariff on all cars from Mexico, a "more than" 60% tariff on all goods from China, and an overall 10% to 20% tariff on everything else that the U.S. imports.
Additionally, he has threatened tariffs under a national emergency authority typically used to impose economic sanctions, and that has never been used as a basis for trade tariffs. Average tariffs under the second Trump administration are expected to rise at least to Second World War levels, or possibly to levels not seen since the 1870s. To accomplish this, Trump and his policy advisors have also floated the idea of renewing long-unused trade authorities, such as the Section 122 Balance of Payments Authority of the Trade Act of 1974 and Section 338 of the Tariff Act of 1930.
Multilateral Institutions and International Partners
The foreseeable consequence is that the U.S.'s trade posture will become decidedly less multilateral under a second Trump administration.
Under Biden, the U.S. has strengthened multilateral ties with allies in Europe and Asia, for example, to coordinate and better counteract the restrictive trade practices of China while advocating for U.S.-friendly changes.
Trump and his trade policy team view multilateral institutions as a waste of money and mere political showmanship from which the U.S. has not benefited. Ultimately this view could culminate in Trump unilaterally revoking the United States' grant of Most Favored Nation (MFN) status to China.
Other secondary opportunities to coordinate trade activities with multilateral allies, such as those resulting from the U.S.'s leading involvement in strengthening NATO amidst Russia's invasion of Ukraine, may similarly fall by the wayside under a second Trump term.
The Players
A wide variety of industries and players are expected to be impacted by a second Trump presidency. In general, tariffs on goods from China, tariffs on goods in sectors seen as essential to US national and economic security (such as auto manufacturing, computer parts, extractive industries, and especially critical minerals), tariffs on goods from Mexico, and tariffs on products with which the U.S. has a particularly large trade deficit may be new targets.
While Trump's cabinet will likely differ significantly from his first administration, Peter Navarro, Larry Kudlow, and Robert Lighthizer have signaled a willingness to return to Trump's cabinet as trade and economic advisors.
Ultimately, Trump's trade policy is best characterized by its willingness to find creative trade tools and the element of unpredictability itself in support of its trade objectives. In addition, Trump's key trade advisors focus on returning manufacturing jobs that have left the U.S. in the last four decades.
Finally, it is worth noting that while courts have historically deferred to executive agencies in matters of national security—and for trade policy when mixed with national security concerns—courts would be increasingly hard-pressed to give this deference under a regime of such expansive trade action, coupled with new restrictions on courts' deference to administrative agencies under Loper Bright.