The GOP’s protectionism detour has run its course

After more than five years in office, and with a trade policy largely left in place by former President Joe Biden (which should give Republicans pause), it’s worth taking stock. The results are not encouraging.

On the China front, no one can credibly argue that heavy and sustained tariffs have prompted the country to change its ways. Even the U.S. government has acknowledged as much. Instead of producing reform in Beijing, the administration has often focused on trade battles with longtime allies rather than building a coordinated response to China.

If the goal is to compete with China, the answer isn’t to wall off the United States but to link arms with its allies. Deeper trade ties in the Indo-Pacific would strengthen supply chains and ensure that global rules are shaped by the U.S. and its partners, not Beijing.

But the administration opted for conflict rather than cooperation, engaging in skirmishes with allies that became the preamble to numerous trade deals widely described as liberating the U.S. from years of abuse. The deals signed in the president’s second term, however, have proved ill-conceived. Concluded under the threat of tariffs, the agreements secured modest foreign tariff reductions while locking in significantly higher U.S. tariffs under the guise of reciprocity.

On net, these deals have made trade more difficult and more costly for Americans. Their result has been a sapping of American economic strength.

Perhaps the clearest example is manufacturing. Far from revitalizing the sector, tariffs have proven an unwelcome headwind by raising the cost of key inputs. Manufacturing depends on access to equipment, components, and raw materials at competitive prices, but tariffs make them costlier.

Consider the administration’s tariffs on steel and aluminum. Imposed during the president’s first term, a 2023 government study found that the tariffs increased output in those industries by $2.8 billion annually. The industries that use those metals, however, saw their output decrease by $3.4 billion — a net loss of $600 million.

Manufacturers haven’t been the only victims. Farmers have faced higher costs on inputs ranging from fertilizer to fencing, while also bearing the brunt of foreign retaliation. Soybean sales to China collapsed during the early years of the trade war and, despite periodic rebounds, remain below recent historical averages.

Such was the damage that the Trump administration provided farmers with billions in bailout payments in 2019, and last year they did it again.

Americans aren’t blind to any of this. Polling shows the administration’s broad use of tariffs has been negatively received by the public. Protectionism isn’t just an economic loser but also a political one. A key factor behind Trump’s 2024 victory was voter anger over rising costs. Higher tariffs, and the higher prices they create, cut directly against that concern.

The protectionist experiment has been run, and the results are in. For the sake of the economy — and their own political future — Republicans need a new trade policy. Or, more accurately, a return to their old one.

After all, Republicans have not always seen trade this way. Urging Congress to renew the Trade Agreements Act to enable tariff reductions, Dwight D. Eisenhower made the often overlooked point that if the U.S. wished to sell its goods abroad, it also had to buy from abroad. Ronald Reagan was even more direct. Protectionism, he argued, was “destructionism” that destroys jobs and weakens industries.

Beyond economics, Republican philosophy offers its own case against tariffs. Tariffs are taxes, and their imposition by executive decree represents a significant expansion of presidential power. For decades, both tariffs and expansive executive power have been — with good reason — anathema to Republicans. Yet earlier this year, the Supreme Court held that the president overstepped his authority by imposing tariffs under the International Emergency Economic Powers Act.

Notably, Trump himself has even at times implicitly recognized the limits of trade barriers. His administration has issued a historically long waiver of the protectionist Jones Act when restrictions proved too costly and rolled back tariffs when they threatened key industries. When the stakes are highest, even proponents of tariffs turn to flexibility.

The choice facing Republicans is not between being pro-America and pro-trade. It is between symbolic protectionism and actual competitiveness. America’s strength has never come from walling itself off. It has come from engaging with the world on its own terms with confidence in Americans’ ability to compete and win.

Colin Grabow is an associate director at the Cato Institute’s Herbert A. Stiefel Center for Trade Policy Studies.