How is Trump’s Tariff Affecting America Negatively in 2025

In Trump’s second presidency, he increased all the tariff to the other countries without 
seeing their contributions for America economy. He gives a high tariff to most big countries, 
which makes harder for other countries to sell their production to the America, as the top three 
country with most population in the world, behind China and India. It means the producer 
countries will have difficulty on delivering their goods to their consumers in America, because it 
is expensive. In Trump’s administration view, tariff is important to protect local industries and 
foster economic self-sufficiency. However, the way President Trump gave a very high tariff, even 
two times more than before, get negative responses from other countries. This will lead them to 
change America relations with the other countries, because most of the countries will find a new 
consumer beyond America. That is why, it is important for Trump’s administration and American 
to check and review it again the negative effect on Trump’s tariff in 2025. The negative things 
like inflation on America’s goods, expensive imported items, and changing current world orders 
will make America suffer economically.

The one effect of tariff that we can see clearly is the inflation on goods, because America 
does not have a lot of resources to build an item from zero. Reported by Sherman on BBC (2025) 
that the price average in America rises from 2.4% to 2.7% in June. She also adds that housing 
costs was one of the most increase item in America. It has a contrast with what Trump said about 
tariff, that this should be contributing on protecting local industries, boosting local manufacture 
and bringing revenue for the country (Sherman, 2025). With rent price going up, the labor will be 
very hard to find an appropriate living place and to match it with their salary, that can 
leave a penny to save for them. It will suffer for most people who has an average wage in America; this 
is true that rich people will be richer, and poor people will lose more their money. Because in this 
scenario, the consumers, as we called as lower- and middle-class people, are paying a lot of tax 
to fulfill the profit margin of companies that usually managed by the upper-class people. 
Moreover, it is not only consumers that get affected but also the producer or manufacture. 
According to Alice Wallace on CNN (2025), she says that The Producer Price Index have been 
slowed by the tariff, because it is raising the price of the goods. This evidence will make the 
manufacture goods even slower and be hard to sell the items to the consumers because of the 
prices. The fast solution for them is to reduce production cost, which means will reduce the 
resource on the product and the consumers will not get a full function of one product than it 
supposed to be. For instance, if there was an inflation on chocolate, the restaurant could adjust to 
reduce the chocolate usage and attach the same price as before; but, in real world, items like 
technology hardware is fixed item that cannot be reduced at any points, that is why the producer 
need to mark up the price because they cannot reduce any part within it. Inflation does not only 
cause suffering for consumers and producers but also have a chance on harming economic 
growth like Gross Domestic Product (GDP). In National Bureau of Economic Research’s 
(NBER) article (1997), it states ‘inflation not only reduces the level of business investment, but 
also the efficiency with which productive factors are put to use’. The productive factor and 
business investment will lead to the GDP problem, because since GDP is the total amount of 
revenue that gained by the government in one year; the less productive manufacture will lead to 
decrease total amount of items or services produced in that year, and it will disturb economic 
growth. Likewise, the investment is also important for country’s economic growth, because the 
investor will support the local manufacture to push the production. The tariff is also affecting 
on how stocks going on America; almost all the stocks had been decreasing in the early stage of 
tariff. So, it is true that Trump’s tariff will establish inflation in America, and it will be expanded 
to another problem.

Inflation can be cause by the expensive imported goods, because Trump gives a high 
price for items from other countries; and it will affect America’s goods that rely on imported 
materials. Like what it mentioned before, an item like smartphone cannot be produced in 
America alone, because they need materials like rare earths to make a power electricity for the 
phone. Baskaran and Schwartz (2025) argue that America is really relying on those rare earths 
not only make phones but something more important like ‘defense technologies’. We know that 
government have a responsible to make sure their people in the safe place and bring prosperity; it 
is not wise to make complex the connection to another country, like to China, that contribute to 
your own defense system and it will be weighting for America’s economy to buy rare earths in a 
high price because of their own policy on trade systems. Even though some people will say that 
America is ready to provide themselves their own rare earth, but that is also what Baskaran and 
Schwartz (2025) are questioned about in their article, and they conclude that America’s rare earth 
industries are not ready to fill the gap on what the government needs and what they have 
currently. This is the evidence that is tariff will have a side effect for international relations, that 
we will discuss in the next paragraph, on how all countries must cooperate between each other to 
stabilize global governance. Moreover, this Trump’s tariff run with reciprocal terms which means 
America gives a tariff to one country, because that one country also gives a same to America 
before. However, the problem is Americans are mostly consumers than manufacture labors, 
different with China that most of their people are industry labors and able to produce a million 
item in a week. That is why this is unfair for China that they do not get a valuable return from America. 
This cause the higher price for China’s product in America, but it is not really affecting 
on America’s product in China, because People Republic of China do not really need America’s 
product, they can have the resources while America do not have it. It is not only between 
America and China but also for America and other countries, like with United Kingdom, which 
have a high tariff on steel and metal; with Indonesia for agricultural products (Sherman, 2025). 
But the reason why we talk much about China, it is because will lead to the global governance or 
change on current world order. So, tariff cause high price of imported goods, then will lead to the 
inflation.

Trump’s tariff is not only resulting inflation and the rising price of imported goods, but 
also it is a sign of beginning of new world orders. Perhaps not only because of Trump tariff that 
will change current world order; the events like Russia-Ukraine, Israel-Palestine, in the past we 
got Covid-19 and many more. According to Vocabulary.com, world order refers to ‘a global 
arrangement of nations and systems intended to maintain international stability’. If we look back 
to the history, after World War II, the winning sides like America, Soviet Union (Russia was 
recognized as the legal successor state), France, United Kingdom and Republic People of China 
were the countries that given a right to maintain the stability of the world order after the 
establishment of United Nations. But not all those countries (as we called as Permanent Member 
of 5) are ruling economy trade in the world. In the 20th century, America was leading financially, 
because beside America was a winning side, they also gave a financial support for the defeated 
countries and expanded their ideology about the liberal system. However, it has changed slowly 
in recent 21th century, which China have a great manufacture and technology invention. For Nye, 
Jr (2025) from Project Syndicate article, he states that world order can change if there were 
changes in military and economic power; civilization and political harmony; and revolutionary movements. 
If we look at those factors, America is losing to China and more specific BRICS 
(Brazil, Russia, India, China, South Africa), because tariff itself is the sign that America isolates 
themselves for avoiding other foreign items destroy local industries. Even Trump’s tariff is also 
against their own side, which is G7 (Group of 7), that giving a high tariff for United Kingdom in 
steel, for Japan in vehicle, and Canada in consumer goods. Even China has a great technology 
that ready to be sold overseas and will sweep all the western products, such like China’s 
electrical vehicle BYD is in the top of the list in most selling electric vehicle in the world 
according to Autovista24 (2024). This is only one fact that America as the leading economy 
country will be replaced by China soon, because the quick transition in all sectors. Perhaps that is 
the reason why the tariff has a benefit to protect local industry, like Tesla, because if China’s 
BYD enter America, Tesla will lose because of the price difference. In 2022 Goldman Sachs 
published their prediction about the global economy leaders, and the result China will surpass 
America in the few years from now. So, America is in danger because they will lose in economic 
sector against China, and it will change the world orders in international relations.

In summary, Trump’s tariff has several minus points that still need to be discussed by the 
Trump’s administration, because if those negative things remain happen continue, America will 
lose their domination in global economy. Some people might say that to balance America 
economy, avoid trade deficit and protect local industries; however, because America gives the 
tariff to all countries then it becomes global issue. And tariff is not only affecting other countries 
make them hard to sell items, but also America itself, because the people still need foreign goods 
that they cannot produce it in America. The things that will harm America like, inflation, 
expensive price for imported goods and changes in world order. Those still need to be evaluated, 
hence, to make better economy conditions and international relations. So, this essay provides 
the negative effect for America to make us realize that our own command might hurt ourselves, just 
like Trump did to his own country.

Works Cited
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