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During his 2024 campaign, President Trump ran largely on a platform of lowering costs for average Americans. But as the administration ramps up its work, most of the chaotic steps taken so far will have the opposite effect on Americans’ pocketbooks.
Trump’s moves have the potential to upend the U.S. economy and global trade, impacting everything from the price of new cars to food and home heating bills.
The Trump administration has put forward several proposals on tariffs, including:
- An additional 25% tariff on imports from Canada and Mexico (except Canadian energy products, which would face a 10% tariff), slated to begin March 4. (Note: On March 6, these tariffs were temporarily adjusted to exclude goods that comply with the US-Mexico-Canada Agreement or USMCA. The exemption lasts until April 2, when reciprocal tariffs go into effect.)
- An additional 10% tariff on imports from China, which has already begun. (Note: On March 4, this tariff increased to 20%.)
- An additional 25% tariff on steel and aluminum imports, slated to begin March 12. (Note: On March 11, this tariff was increased to 50% for Canadian steel and aluminum.)
- Reciprocal tariffs against countries that have import taxes on US goods, slated to begin April 2.
- Trump has also said he would consider tariffs on other imports including cars, pharmaceuticals, and semiconductors.
When tariffs are used strategically, they are not necessarily “bad.” Decades of free market trade policies encouraged manufacturers to establish factories overseas in countries with weaker labor and environmental regulations. This reduced U.S. jobs, polluted communities overseas, and exacerbated climate change.
If carefully applied, tariffs can help reverse these trends and revive America’s manufacturing sector. However, tariffs alone are not enough — they must be part of a comprehensive strategy.
It is one thing for tariffs to raise prices AND also create more consumer choice, reduce pollution, and encourage manufacturing innovation. But right now, these tariff proposals are delivering one without the others. The tariffs on two of our closest trading partners, Canada and Mexico, are clearly intended to advance ugly geopolitical goals and diminish relationships with allies. And the proposed tariffs on steel and aluminum imports will only harm working families — unless the administration implements additional measures to help America’s manufacturing sector thrive.
Reviving American Manufacturing
As part of a thoughtful industrial policy approach, tariffs can help deliver good jobs and improve the quality of life for working families.
The Trump administration’s current approach to tariffs risks raising prices on everyday goods, without reducing pollution for people living near factories, creating good jobs at cutting-edge facilities, or supporting the growth of America’s manufacturing sector.
Right now, many critical goods — like cars and transformers for the electrical grid — depend on steel and aluminum imports. These and other consumer goods that rely on imported steel and aluminum are very likely to get more expensive — or more scarce — due to the lack of a comprehensive plan to address the cost and supply gaps that tariffs will generate.
The “no exemptions” part of the proposed steel and aluminum tariffs is especially concerning. The U.S. gets most of its primary aluminum from Canada, and right now our capacity to manufacture aluminum domestically is far behind demand. Failing to create an exemption for Canadian aluminum, like we had during the first round of Trump’s tariffs and Biden’s extension of those tariffs, will likely mean higher prices on aluminum-based goods.
Immediately after Trump announced the steel and aluminum tariffs, the Sierra Club sent a letter calling for the tariffs to be coupled with an innovation agenda for the U.S. steel industry that includes domestic investments, research and development, tariffs on foreign pollution, and markets for clean American steel.
Aging Factories Need Upgrades
While tariffs can help the U.S. increase production, many decades-old steel factories need serious maintenance and upgrades to achieve peak performance. As noted above, U.S. production of aluminum is considerably lower now than in past decades, with a heavy reliance on Canadian imports. There are plans to build new state-of-the-art aluminum factories in the U.S., but funding is threatened by federal budget cuts. Both of these manufacturing sectors are prime examples of why the U.S. needs investments in innovation paired with tariffs.
To ensure the U.S. is positioned as a leader in clean manufacturing, any growth in America’s manufacturing sector must be accompanied by commitments for factories to meet high environmental and worker safety standards.
We need to move past primitive steelmaking methods that rely on coal or aluminum manufacturing methods that produce enormous amounts of toxic air pollution. This will only put communities and workers at risk.
Failure to move beyond these outdated manufacturing methods is foundational to the need for tariffs in the first place. Tariffs tied to strong environmental performance, rather than the Trump administration’s broad tariffs, ensure American companies prioritize clean manufacturing and prevent polluting foreign companies from importing goods into the U.S.
These steel and aluminum tariffs undermine efforts to improve global trade to serve working families and bring manufacturing jobs back to the U.S.
A thoughtful tariff policy — one paired with investment in America’s manufacturing sector and the creation of markets for clean steel and aluminum in products like electric vehicles, wind turbines, and solar panels — can improve the health of American families, create good jobs, boost the economy, and position the U.S. as a leader in clean manufacturing.
Without it, the cost of these tariffs will only harm Americans’ pocketbooks.