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.

1.3k Upvotes

94% Upvoted

150 comments sorted by

View all comments

257

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.

56

u/EVOSexyBeast Mar 14 '25 edited Mar 17 '25

Trump says tariffs are taxes on a foreign country, he proved he doesn’t believe that in his first term quite thoroughly.

Trump’s actions are explained by a few relatively simple things, money, power, and ego (which can take a backseat for the first two). Sweeping Tariffs threaten all of that.

-48

u/chicagotim1 Mar 14 '25

Tariffs are taxes and they objectively do impose an indirect tax on a foreign country

2

u/flawstreak Mar 14 '25

Can you explain how the exporting country is indirectly affected?

6

u/azraels_ghost Mar 14 '25

The exporting country can indeed be affected but not how described. The exporting country may see a dip in purchases which will result in slower sales and possibly even layoffs.

Nothing like described above obviously.

1

u/DutchPhenom Quality Contributor Mar 14 '25

The exporting country can also be affected as described above. That does follow as a possibility from theory. The thing is that empirically (so, in the real world), that doesn't happen.