Trump in chaos: tariffs, power games and the future of America!

Trump in chaos: tariffs, power games and the future of America!

The political landscape in the USA has changed significantly in the first 220 days of Donald Trump's second term in office. The economy is under pressure while at the same time the Constitution is being challenged. A multipolar world order is emerging, and Trump's presidency is described as chaotic and unpredictable. Many twists and turns and uncertainties characterize the current situation, which is leaving clear traces both in terms of domestic and foreign policy. NZZ reports, that Trump's style of government shows authoritarian tendencies and seeks to strengthen the power of the president.

A central component of Trump's politics is his mercantilist economic policy. This is accompanied by high tariffs and a move away from multilateral trade. Trump has increased tariffs to their highest level since the 1930s, raising the average tariff rate from 2.4% to 18.4%. This is happening in an environment where the US is flouting existing trade agreements and WTO rules, which has been criticized as “hacking” the global trading system.

Economic policy measures

As part of his economic policy agenda, Trump promised to usher in a “golden age” for the United States. He sees tariffs as a key instrument for making imports more expensive and promoting US production. From Wednesday, for example, 25% tariffs will apply to all steel and aluminum imports. This erratic tariff policy has already led to tensions with Canada, which, in response to the US tariffs, imposed counter tariffs worth almost 20 billion euros per year. Tagesschau reports, for example, tariffs on agricultural products of up to 250% have been announced.

The situation in Mexico is also tense. President Claudia Sheinbaum has focused on dialogue, while Trump has announced punitive taxes on imports from Mexico, which, however, have not currently been imposed. Mexico plans to increase exports under the USMCA agreement, apparently to avoid pressure from Trump's tariffs. At the same time, China, as the most important trading nation, is increasing the pressure by imposing retaliatory tariffs on US agricultural exports and expanding trade restrictions on US companies.

Impact on the industry

The US government is also planning fees for ships that come from China and dock in US ports. This approach draws attention to the unforeseeable economic consequences that could result from high tariffs. Uncertainty about tariffs could cause companies to delay investments, which could threaten economic stability. Despite these challenges, observers report that the Republican Party is strongly following Trump's line and is thus having a lasting influence on the US political landscape.

The short- and long-term effects of Trump's aggressive economic policies remain to be seen. While the current economic stability provides some reassurance, the question remains how inflation and other economic effects will develop.