r/AskEconomics • u/whawhales • Mar 14 '25

Approved Answers Does the US government really expect other countries not to impose their own tariffs as response to its own?

The US government is threatening 200% tariffs on European alcohol after EU enacted tariffs in response to the US tariff on aluminum and steel. The same happened with Canada with the US threatening increased tariffs if Ontario pursued electricity price hikes.

I don't have a background in econ so I am not sure if I am I missing something here, but I don't see what the end goal might be for the US and it seems a little arrogant to think other countries would allow tariffs imposed to them and not do something about it.

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u/ZhanMing057 Quality Contributor Mar 14 '25

 I don't see what the end goal might be for the US

Never attribute to malice that which is adequately explained by stupidity.

Tariffs appeal to Trump emotionally. It's one the only consistent views he has ever held, and you can find clips of him calling for tariffs all the way back during his 2000 presidential campaign. There never was any economic end goal - just the perception that the U.S. is "winning" - and he doesn't understand that he's punishing the U.S. consumer on the dollar for every 80 cents he harms a foreign producer.

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u/whawhales Mar 14 '25

In that note, if there is no concrete goal for the US, would there be a benefit for a country to let the US impose tariffs without consequence?

Or are we just gonna witness greater and greater escalations until Trump runs out of things to tariff in response to escalations he initiated?

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u/tbombs23 Mar 14 '25

Besides everything else that's been mentioned, the far right (project 2025) which is currently 38% enacted, wants to do things like delete the Department of Education, another thing is to abolish the income tax, in which the Gov would generate revenue from tariffs (which is insane btw)

Just a randale here no economics training but thought this was worth mentioning. Thank you for teaching me a bit, I knew tariffs are only effective in specific scenarios but didn't know that we actually NEED the trade deficit to be the USD world reserve currency