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Last Updated on: 31st March 2025, 08:40 pm
President Donald Trump is all smiles as he prods senior advisers to expand his tariff policy. The White House has labeled the April 2 enactment day of tariffs “Liberation Day.” An anonymous Washington Post source has revealed that administration officials are preparing tariffs on “trillions” of dollars in imports.
“It’s a liberation day for our country because we’re going to be getting back a lot of the wealth that we so foolishly gave up to other countries, including friend and foe,” Trump told reporters on Monday. Trump’s stated goal with the tariffs is to bring more manufacturing jobs to the US.
The escalation of tariffs is expected to cause further upheaval in global markets as well as the domestic economy, which has already shown stark downward trends due to Trump’s inconsistent trade approaches. On Wall Street, the S&P 500 index has lost more than 8% in the past month; the tech-heavy Nasdaq shrunk almost 13% over the same period.
February manufacturing output rose sharply, reaching its highest level in more than two years. Then again, the jump was in all likelihood a quick bandaid ahead of the presidential tariff announcements.
“Manufacturers raced to produce goods in February before large tariffs on imports could be imposed, as well as to meet a temporary tariff-induced spike in orders from households and businesses,” wrote Samuel Tombs, chief US economist for Pantheon Macroeconomics.
The projected tariffs include a 25% markup on vehicles and parts produced outside the US and are sure to have a broad impact on the North American auto industry. With a target enactment date of April 3, the tariffs are likely to raise the prices of new cars and trucks. The tariffs are putting automakers in a tough spot as they realize existing North American manufacturing operations may need quick examination and modification. Cost cutting seems inevitable.
A Free Trade Clash with Tariffs: The UAW and Workers’ Rights
A March 4 UAW statement on tariffs acknowledges that “free trade” has had “devastating effects” on the working class as corporations kill good US blue collar jobs “to go exploit some poor worker in another country by paying poverty wages.” The UAW is in active negotiations with the Trump administration to end “the free trade disaster.”
Yet the UAW also says that “tariffs are a powerful tool in the toolbox for undoing the injustice of anti-worker trade deals.” Should tariffs disrupt the economy, the UAW says, “corporate America bears the blame for that decision.” Those corporations include the auto industry, says the UAW.
“We want to see serious action that will incentivize companies to change their behavior, reinvest in America, and stop cheating the American worker, the American consumer, and the American taxpayer.”
US-focused worker advocacy group Solidarity is challenging the UAW leadership to reverse its declaration of support for Trump on tariffs and protectionism. The UAW is right to reject “free trade,” writers Lare and Wraight state, with its drive to squeeze more out of workers. But tariffs and nationalism raise prices for everyone, especially workers and the poor, they continue, and can lead to economic depression.
By endorsing the Trump administration’s position, the UAW is, in essence, supporting a “deeply anti-union” leader who “has paralyzed the National Labor Relations Board.” While extending an olive branch to Trump, the UAW has forced “a blow against international labor solidarity.” Lare and Wraight recall how, in interviews and speeches, UAW President Shawn Fain identified his family’s move from the South to Indiana for jobs as similar to immigrants who move to the US.
With past political shifts to protectionism, followed by neoliberalism, Lare and Wraight accuse the UAW of halting its fight against corporations. As a result, “competence declined, corruption increased.”
There are no winners when it comes to President Donald Trump’s tariffs on car imports, Wedbush Securities Inc. analyst Daniel Ives concurs in a note published last Friday. He describes the levies as a “back breaker and Armageddon” for the automotive industry, as reported by Bloomberg.
Following discussions with several people within the industry globally, Ives said the conclusion was that tariffs would cause “pure chaos” and increase the average price of cars between $5,000 to $15,000 in the US.
“Every automaker in the world will have to raise prices in some form selling into the US. The supply chain logistics of this tariff announcement heard around the world is hard to even put our arms around at this moment. The concept of this auto tariff in our view would be a back breaker and Armageddon for the auto industry globally and throws the supply chain into pure panic mode. We believe this adds up to $100 billion of costs annually to the auto industry and will essentially get passed directly onto the consumer and clearly erode demand on day one of tariffs.”
Every automaker will feel some kind of impact. General Motors builds a large number of highly profitable pickup trucks and sport utility vehicles in Canada and Mexico. Toyota and Honda make popular SUVs in Canada. Volkswagen assembles the Jetta sedan, Tiguan SUV, and other popular models in Mexico.
The Dismal State of the US Economy is Only Destined to Worsen
Heather Long describes Trump’s economic policies this week in the Washington Post as “pushing the economy to a breaking point.” Sweeping tariffs and rapid cuts to immigration and the federal workforce have generated a growing fear, Long continues, “of not just a recession but stagflation, a frightful situation — not seen in the United States since the 1970s — in which the economy contracts and people lose jobs but prices remain high.”
Consumer sentiment has plunged more than 30% since the November presidential election. People in the US are anticipating a 5% inflation jump in a year.
Under Trump, even the rich are worried they will be worse off in a year.
“Americans hated high prices under Biden,” Long reminds us, but offers: “It could get a lot worse if there’s stagflation under Trump.”
The progressive wing of the labor movement is beginning to mobilize against Trump’s policies. Federal workers are fighting back. Union and community activists are participating in the streets.
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