Trump's First 100 Days: Tariffs As Foreign Policy

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I'm Tamar Keith. I cover the White House.
This week on The Pod, we are doing something a little different,

taking a look at some of the policies and decisions President Trump has made in the first 100 days of his second term. Today, how the president's economic policies are causing uncertainty around the world.
It starts with tariffs, taxes on goods imported to the United States. Those taxes are paid by importers who then typically pass the cost on to consumers.
Trump has extolled the virtue of tariffs. The word tariff is a very misunderstood word.
You've heard me say, I say it kiddingly, but it's one of the most beautiful words in the dictionary. It really is.
And said the benefits are massive. We're taking tremendous amounts of money with the tariffs.
But the markets have disagreed. The Dow Jones Industrial Average is down since the start of the year.
Grocery prices are still high. Consumer sentiment is way down.
And economic forecasters are raising their odds of a recession coming. So today, let's talk about Trump's economic policies, how they work, what their goals are, and whether they are meeting those goals.
With me, my fellow White House correspondent, Asma Khalid. Hey there.
And business correspondent, Alina Seljuk. Hello, hello.
Hello. So Asma, let us start with the basics.
Just walk us through where we stand right now with tariffs. In terms of tariffs, look, I mean, the president has outlined a whole bunch of tariffs on things like the steel industry, the auto industry.
But the central vision of this was something that he and his administration described as being reciprocal tariffs, which were going to be just sort of somewhat arbitrary numbers slapped on a whole bunch of countries around the world, in his view, to equalize trade. He said that the U.S.
was being ripped off, that there was a trade deficit, and he wanted to sort of just improve that trade imbalance, in his view. And so he slapped these numbers on, then he rescinded them.
And where we are at this point is he has kept in place a broad-based 10% tariff on pretty much every country in the world, with the exception of Mexico and Canada. And in addition to that, he has 145% tariff on China.
China, in response, put 125% tariff on American goods. And what experts say that means is that virtually if those tariffs remain in place, you've halted trade between two of the world's biggest economies.
And that's really key here. So what is the goal here? And I realize that's a loaded question because there have been many stated goals.
Mm hmm. The president has long believed that tariffs are a useful tool to, in his view, bring manufacturing back to American soil.
He also views tariffs as a negotiation tactic for a whole bunch of other things, whether that's immigration or fentanyl coming into the United States. I mean, he views this as a one size fits all tool for many different policies.
And there's also a bit of a contradiction there, which is that if you have companies moving their manufacturing to the United States, then they're not paying the tariffs. So the revenue you're promising from the tariffs would go down.
It kind of one contradicts the other. Yeah.
So what does this mean for U.S. businesses? How are they reacting to it? How is it affecting their business? I think obviously American businesses vary.
Some of them make stuff. Some of them don't make stuff but sell stuff that they bring from abroad.
Across the board, they've built their businesses around a global trade that free flows around the ability to bring in parts and components and build their machines here and then export those machines abroad. Or around being able to ship bridal gowns from China because that's where most affordable bridal gowns are made.
And then you put them in a store here and charge people reasonable prices that people are used to paying. And now you have, well, first of all, this up and down, this is in, this is out.
Tariffs are in, tariffs are gone, tariffs are paused, maybe coming back, maybe not. The word I hear a lot is obviously uncertainty.
We talk about uncertainty a lot. Companies, small and large, are having a really difficult time kind of planning along.
I've talked to some that are playing the waiting game. They're thinking this is all going to blow over.
Most say that if it doesn't blow over, they will have to start raising prices. And whether it's a supplier kind of in the chain of companies, whatever that increased price is, it starts trickling upward or downward, I suppose.
And at the end of the day, if you have a small shop and you're bringing, I keep talking about bridal gowns, and the bridal gowns are now 145% more expensive coming into the U.S., well, you're no longer going to charge $1,000. This is a much more expensive bridal gown now.
Have you spoken with businesses that are moving their operations to the U.S.? If one of the goals of this is to bring America's golden age of manufacturing back,

is that in the works?

It's actually been in the works since 2018 for some of the companies.

So in 2018, there was a long period when many companies, manufacturing companies specifically,

kind of thought to themselves, is this a real thing that we're going to live with forever?

And when it became a real thing that we're still living with, a lot of companies decided

to open up manufacturing in the U.S. I talked to a guy whose company makes power supplies sort of for industrial machines like your x-ray machine in a hospital, for example.
And he says that their choice at the time was to say, let's move some of our manufacturing to Malaysia and Thailand, because obviously China is much more expensive now. They thought they were brilliant.
And now they're sort of dealing with the fact that, oh, that's actually costing a lot. But then he says a lot of his peers did start opening manufacturing here in the U.S., in Texas, in California, moving it from Mexico or from China.
It is not at all like flipping a switch. And also, he said, moving one line of production costs $100,000 just to move it from one place to another.
And fundamentally, China has been the cheapest place to do all operations. So if you're moving it from China to Malaysia, that's already an 8% to 20% increase in a cost.
If you're moving it to the U.S., that is an even higher cost. All right.
Well, we are going to take a quick break. And when we get back, more on Trump's economy.
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And we mentioned that there's been a lot of stock market volatility as a result of these on again, on less again, off again, on again tariffs. And the president has tried to say that he doesn't care about the markets anymore.
But now he is, at least on rhetoric, softening on China. I don't know if it gets beyond rhetoric, but Asma, you've been reporting on what he's been saying about these China tariffs, which, as a reminder, are 145 percent.
Yeah. I mean, those are huge tariffs.
Experts will say that these are just levels of tariffs that we have not seen. And I think that's important to keep in mind.
But, you know, in terms of what we're hearing from the president, I've been describing it as a shift from the tough posture he and his economic advisers were taking with China. Right.
I mean, you remember this at the beginning. He was saying tariffs might require some sort of economic pain, but it would be worth it.
He's now saying this week that that 145 percent tariff won't remain that high. I'm not going to say, oh, I'm going to play hardball with China.
I'm going to play hardball with you, President Xi. No, no.
We're going to be very nice. They're going to be very nice.
And we'll see what happens. But ultimately, they have to make a deal because otherwise, they're not going to be able to deal in the United States.
So we want them involved. And they continue to create this environment where companies that are trying to decide whether to move manufacturing or to raise prices, they don't know whether these are reasonable decisions to make in light of unknown decisions that the White House will make, right? Like it actually continues the uncertainty and people not knowing how to react to whatever is coming down the pike.
Alina, you have been focused on consumers and consumer prices. You have a market basket that you've been checking back in on, which I love.
In part, President Trump won in 2024 on an economic message that focused on everyday Americans who were struggling with higher costs, who kept talking about groceries and gas prices being high. And his message was, I will lower these costs.
What is the picture now? Well, caveat immediately, presidents don't have too much power to flip a switch and change how much things cost at your grocery store. And there are a lot of concerns about tariffs eventually leading to higher prices on the store shelves.
So also, President Trump came into his second term as the economy was fairly stable. Inflation was cooling, unemployment pretty low, wages growing.
People were sort of anxious about their budgets and were clearly sort of choosing to buy necessities over not necessary things, but generally things were kind of going along. Now what you have is some prices are higher, some prices are lower.
It's like any other time. You have unemployment still pretty strong, which I think jobs and wages are driving a lot of people to keep shopping.
And so we're seeing people going out to eat, people still buying stuff. One thing we have seen sort of on the downside is extreme anxiety.
Consumer sentiment from the University of Michigan has some of the lowest numbers for how people feel about the future of the economy in decades. The other thing that did happen is in March, people bought a lot of stuff, big ticket items, in advance and anticipation of tariffs.
So you also see a lot of defensive spending, I guess is the term. You had particularly people buying lots and lots of cars, out of worry that prices for cars will jump up.
So were you saying that the effects of the tariffs haven't actually really been felt at cash registers yet? Exactly. You know, when President Trump says short term, what was it? Short term pain.
We haven't we haven't seen that yet. It hasn't kicked in yet.
Tariffs, most of the sweeping ones are just kicking in this month. Many companies are still selling through the stuff they had before.
They'd shipped it before they stashed it. Now they're selling it.
Obviously, they're not going to wait until it's, you know, the last widget that they have to start raising prices. But they will wait enough time to see how this trade negotiations might shake out or something else might change.
So the big price increases that could potentially happen, they have started to trickle out on some individual items, but not dramatically across your supermarket. I do think that consumer confidence, consumer sentiment metric is really key because when you look at both that number, but also if you look at public opinion polling, Pew Research Center has some new data out this week that shows the confidence in Trump's handling of the economy is low.
It is underwater, less than 50 percent. It is his lowest confidence rating on this measure of the economy in surveys dating back to 2019.
And that is important for a man who ran on a promise to improve the economy, because if people don't feel good about the economy, that is affecting how they view Trump overall. Yeah.
And I remember you being at a cabinet meeting, I think, asking the president, what about this consumer sentiment number? He was dismissive of the idea that people were feeling any sort of economic anxiety. But the reality is, and this is something that I think the Biden administration also, his predecessor, struggled with, there is economic data and then there's the way that people feel about the economy.
And if at some point as the president you don't reconcile with that, that's when I think people sort of start distrusting the economic message. And at this point, I think, you know, look, some economic data is good, right?

But people don't feel great about it.

You can't keep telling people, hey, things are great when they don't feel like everything is great.

To go back to my bridal gowns example, the owner of that store, he told me, you know, he supports the president's goals. He supports the president's push to level the playing field globally and close those trade deficits and, you know, get America on proper trading terms with a number of countries.
But he was super stressed out about his business. And he was saying, what am I supposed to do? Where else am I supposed to get these affordable bridal gowns? They're only made in China.
And his argument was that you can't sort of put sweeping tariffs on all of the world and, you know, expect businesses not to close. And I think this is what makes this moment particularly challenging for a number of American businesses is what I've heard is in the first Trump term, there was some degree of predictability.
They understood his vision was to really sort of tackle China. And so some of them moved their supply chain lines to Vietnam, Indonesia, elsewhere.
This time around, when you've got blanket tariffs on a chunk of the world, there isn't clarity on where else to go. And what you hear from the Trump White House is that they are negotiating deals with a whole bunch of countries.
They say they are in conversation with some 90 plus countries. Of course, the challenge here, as you know, Tam, is that it takes a long time to actually negotiate a trade deal.
And so how do you walk back from the tariffs you've already put in place? Well, and in the meantime, this conversation about American-made goods is sort of taking center stage. And I've talked to so very many small business owners, and I asked them that question, can you just get your stuff here domestically, like shoes, clothes? Well, first of all, not a tremendous amount of manufacturing of shoes, clothes, toys, home decor.
So much packaging is done in China. So even if you make some stuff here, it is often cheaper to ship it to China, package it there, and then ship it back.
Everyone is sort of making these very complicated supply chain choices. But as a small business, You know, you talk to someone who says they sell boots that are American made and I sell boots that are from China and the boots that are American made are $400.
Who is going to buy them? Right. Some people will.
But just the price difference or the same bridal gown guy, he says, I sell, you know, an American made dress and it is $4,000. Who is going to buy that? It's a very particular choice that people make to buy American-made because we are so used to having prices of imported goods being so much cheaper.
OK, Alina Seljuk, thank you so much for joining us. Thank you.
And that is all for us for today. Tomorrow on the pod, Trump's immigration policies and efforts to reshape the federal government.

I'm Tamara Keith. I cover the White House.

And I'm Asma Khalid. I also cover the White House.

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