California Governor Gavin Newsom, a Democrat, announced on Friday his intention to initiate direct trade agreements with foreign nations to protect the state from repercussions stemming from President Donald Trump’s new tariffs.
Newsom instructed state officials to seek independent trade relationships with countries affected by tariffs and advocated for exempting California-made products from such retaliation. press release. The governor made his case by highlighting the state’s economic significance and distancing himself from Trump’s trade policies. (Related: China will escalate trade conflict in response to Trump’s “liberation day” tariffs)
“Donald Trump’s tariffs do not reflect the opinions of all Americans, especially those I represent in California, which is the fifth largest economy in the world,” Newsom stated. “We value international trade. We respect our manufacturing sectors, being the largest manufacturing economy in the U.S. This highlights our commitment to all international trading partners. California stands as a reliable trade partner.
To our trade partners across the globe – California is prepared and willing to engage.
We will not remain passive during Trump’s tariff conflicts.
California represents 14% of the U.S. GDP. We are the fifth largest economy globally.
We are unafraid to leverage market power to respond… pic.twitter.com/ytfbcww1so
– Gavin Newsom (@gavinnewsom) April 4, 2025
The governor’s remarks were made in light of the President’s “liberation day” tariffs. These tariffs were implemented on Wednesday as part of the administration’s recent initiative to enforce reciprocal import duties on states opposing unfair trade practices. The comprehensive package targets nations including China, the European Union, South Korea, and India, among others. Many of these countries have already hinted at retaliatory measures affecting U.S. exports.
“California is prepared for dialogue,” Newsom expressed, labeling tariffs as “the largest tax increase of our lives.”
When addressing the economy, Trump described tariffs as a necessary step to restore American manufacturing, referring to the situation as “a very ill patient.”
“This was a very ill patient… We lost 90,000 plants since NAFTA and about 6 million jobs. It was an ailing situation that underwent treatment on the day of revelation. It will transform into a thriving nation,” the president stated on Thursday.
.@potus: “This is a very ill patient… I’ve lost 90,000 plants since NAFTA… and about 6 million jobs. It was a sick patient. It went through surgery on the day of release. And it will become a booming country.” pic.twitter.com/ihonz3vsqg
– Quick Response 47 (@rapidResponse47) April 3, 2025
China announced a 34% tariff on all U.S. goods, while Canada also responded. Canada imposed a 25% tariff on American-made vehicles to “establish a framework for automotive manufacturers that promotes production and investment in Canada.”
Some labor unions, alongside United Autoworkers president Shaun Fain, endorsed the “liberation day” tariffs, calling them, “a tool in the toolbox to compel these companies to act responsibly, with the goal of bringing jobs back here.” He stated on CBS News’ “Face the Nation” last Sunday.
“However, there are two components to the tariffs… we need to reform the flawed trade law. Additionally, it is essential that they adequately compensate workers in union jobs,” Fain added.
Dow Jones Industrial Average dropped by 2,200 points, or 5.5%, with Nasdaq decreased by 5.6% and the S&P 500 fell by 5.8% on Friday. (Related: The market is experiencing its second day of turmoil following Trump’s “liberation day” tariffs, creating a global shockwave)
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