Trump’s Tariffs: A Shift from Economics to Political Grievances

President Trump once claimed that tariffs were meant to restore fairness in trade. However, now he leverages them in a manner that seems more theatrically political than economically driven. For instance, he recently pointed out Brazil’s 50% tariff collection, not as a response to trade discrepancies but due to the legal issues faced by former Brazilian president Jair Bolsonaro.

This latest move appears to be less about economic strategy and more about addressing political grievances.

If Trump believes that Bolsonaro’s prosecution for alleged involvement in a coup is unjust, he should consider defending against it or imposing sanctions. Instead, he opts for tariffs that, ultimately, hurt American consumers and exporters, despite a significant trade surplus of $7.4 billion with Brazil in 2024.

In a public letter, Trump accused Bolsonaro of casting a shadow over his reputation, referring to the charges against him as “an international dishonor.” He framed the tariffs as a protest against what he views as Brazil’s assault on democratic processes, including regulations on American tech platforms during Brazil’s election crisis.

Labeling these tariffs as “economic” is becoming increasingly challenging. Yet, it’s easy to discern Trump’s desire for dramatic gestures aimed at supporters who respond positively to punitive measures rather than actual policy results.

This approach marks a significant departure from traditional American tariff practices. The Smoot-Hawley Act of 1930, though misguided, had at least a clear aim: to protect American industries. It ultimately failed and worsened the economic situation, but it was rooted in economic reasoning.

Conversely, Trump’s tariffs on Brazil don’t serve economic interests. The U.S. exported nearly $50 billion in goods to Brazil last year, far exceeding imports from Brazil. Nonetheless, American consumers and exporters bear the financial burden of these tariffs, not Bolsonaro or Brazil’s current president, Luiz Inácio Lula da Silva.

Brazil ranks as the 16th largest trade partner for the U.S., and any disruptions could affect various sectors, including agriculture, aerospace, and energy. America is a major consumer of Brazilian goods. Yet, during the spectacle, supporters cheer when Trump makes aggressive moves, even if it means financially hurting themselves.

Currently, Bolsonaro can’t run for office until 2030. He shared with a news outlet that he’s looking to leverage Trump’s support to impose economic pressure on Brazil and aid his potential return. This aim is partially being fulfilled as Trump engages in actions that jeopardize the U.S. trade surplus.

Simultaneously, Trump’s administration has initiated surveys to justify new import duties in Brazil, citing unfair trading practices where American exporters flourish. The outcomes of these surveys seem predetermined, drawing applause from supporters who are not fully aware of the implications.

Trump tends to reinterpret personal grievances as matters of national interest, weaponizing trade policies for symbolic retaliation. The looming consequences of a 50% tariff—such as price hikes, retaliatory measures, and trade relationship strains—are overlooked. Instead, it’s viewed as a demonstration of strength, which is central to populist rhetoric.

In the past, U.S. trade policies often had genuine economic objectives. Even Nixon’s wage and price controls in 1971 attempted to deal with real economic challenges. Today, we see tariffs that target advocacy of coups aimed at countries with which the U.S. has favorable trade relations, producing costs that American consumers may only recognize when prices rise in supermarkets.

When populist performances dictate policy, it is everyone who feels the burden, regardless of their interest in the unfolding drama.