Friends Without Benefits

By David Bernell and Ambassador Thomas Graham (Retired)

President Donald Trump campaigned on a promise of raising tariffs, and he seems ready to implement them. He stated soon after taking office that his administration will impose tariffs of 25 percent on goods from Canada and Mexico (and also 10 percent on goods from China). If implemented, these policies will be likely to please only the president and his staunch supporters and subordinates, who see tariffs as something that will bring prosperity and self-reliance. In reality, tariffs will mostly bring economic pain and political fallout. Consumers, companies that import or export goods to and from these countries, and the United States as a whole, along with its trading partners, will all suffer harmful consequences.

The economic hit will come in the form of higher prices not only of imported goods, but also their domestically produced equivalents, which can command a higher price due to diminished competition. Another impact will be the reduced availability of goods not produced in the United States (think avocados from Mexico). The Congressional Budget Office, as well as nonpartisan organizations such as the Peterson Institute for International Economics have done studies of the economic impacts that these tariffs would have: inflation, fewer jobs, and reduced GDP.

Trump states that tariffs are paid by foreign governments, but this is untrue. Canadian government agencies or companies do not pay the United States for the privilege of being able to sell their products here. Tariffs are paid to the U.S. government by companies that import goods, and they recover the costs by passing them along to customers. Consumers will therefore see price increases in places such as grocery stores (the US imports numerous agricultural products from Mexico and Canada), the gas pump (the largest supplier of foreign oil to the US is Canada, followed by Mexico), and car dealerships (automobile production is highly integrated across the both the northern and southern borders).

American tariffs will also harm our trading partners, putting people out of work and wreaking havoc on their economies as Americans reduce their purchases of Canadian and Mexican goods. These countries will also impose retaliatory tariffs, probably with some strategically placed on goods from states that voted for Trump: Florida citrus, steel from Pennsylvania, corn from the Midwest, Kentucky bourbon. American producers will see their sales to Canadian and Mexican customers drop considerably. The result will be a loss of income, jobs, and investment in industries all across the United States.

The economic consequences of Trump’s tariffs will be bad enough, but the bigger problem is likely to be the political fallout. The words and actions of the American president are harming relations with America’s allies and friends, who are the primary targets of Trump’s hostility and threats. (Trump has spoken quite well of Putin for many years, and once said that he “fell in love” with Kim Jung Il. Trump also doesn’t threaten to take any of their territory like he does a NATO ally.)

Trump has been making such threats for a while. During the campaign he not only promised numerous tariffs, he also derided America’s allies, stating that he would be fine with Putin doing “whatever the hell he wanted” to NATO countries if they didn’t “pay their bills” (Trump has repeatedly mischaracterized the commitment by NATO members to spend at least two percent of their GDP on defense as being delinquent on paying their bills to the U.S. if they haven’t met the target).

After the election, Trump began to speak about using the American military to forcibly take Greenland from Denmark (a NATO ally), and the Panama Canal Zone. He even suggested using “economic force” to make Canada part of the U.S. Energized MAGA supporters took this talk even further, going on social media to post maps showing a “greater” United States that includes these places. This bluster seemed to come out of nowhere, and has served primarily to antagonize countries that have had friendly relations with the United States.

Once Trump was back in the White House, he ramped things up even further. Speaking on video to the World Economic Forum in Davos, Switzerland, he threatened tariffs on EU countries, saying that these nations treat the United States “very unfairly, very badly.” He also singled out Canada, saying “We have a tremendous deficit with Canada. We’re not going to have that anymore.” He then went on to taunt the country, saying “You can always become a state. And then, if you are a state, we won’t have a deficit. We won’t have to tariff you.”

On day seven of the new administration, conflict erupted with Colombia over deportations. When the President of Colombia refused to allow two U.S. military planes to land in his country, Trump said that the United States would immediately impose a 25 percent tariff on all Colombian imports and raise them to 50 percent the following week. In addition, he threatened banking and financial sanctions, along with a travel ban on Colombian government officials. The Colombian president hit back, saying that he would impose tariffs of 25 percent on U.S. imports. The two countries quickly settled their differences, but the Trump Administration said that it would leave the tariffs and sanctions “in reserve” to ensure that Colombia lives up to its commitments.

American foreign policy is being turned upside down by the Trump Administration. The United States is turning its hostility toward its historic friends and allies, countries that it has closely aligned with for decades. These connections have helped to keep the United States and its friends secure and prosperous. They have been grounded in institutions such as NATO, the US-Mexico-Canada Agreement, the World Trade Organization, and a host of other agreements and mutually cooperative actions.

Trampling on friendships and alliances, issuing repeated threats – these actions will have consequences. The clash with Colombia provides a warning to others and an example of what the future may hold. It has also taught the White House a lesson: react to any disagreement immediately and forcefully, issue threats, impose tariffs, and make opposition to American actions very costly. Doing this will cause others to back down quickly and get Trump what he wants while demonstrating his own power. The longer-term damage to the United States and its interests, however, are also likely to be very costly, making Americans worse off economically and isolating the United States from those who have been its best friends and trading partners.

The American people cannot expect other countries to tolerate Donald Trump and a U.S. government that continually throws its weight around, seeking to punish them for some harm (real or imagined) they have done us. Friends without any benefits will soon become no friends at all. In a world where Russia, China, Iran, and North Korea are increasingly aligned and share antipathy for the United States and the global order, and where war and upheaval rage in Ukraine and the Middle East, Donald Trump works toward driving America’s friends and allies away, while the Pentagon under Pete Hegseth focuses on gender issues and pursues the agenda of Fox News. The results may not be to our liking.

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Ambassador Thomas Graham Jr. is former acting director of the U.S. Arms Control and Disarmament Agency under President Clinton, and served as General Counsel of ACDA during the presidencies of Jimmy Carter, Ronald Reagan and George H.W. Bush. He is the author of several books on nuclear arms control, U.S. foreign policy, and American politics.

David Bernell is an Associate Professor in the School of Public Policy at Oregon State University. He is the author of Constructing US Foreign Policy: The Curious Case of Cuba, and The Energy Security Dilemma: US Policy and Practice. He also served in the Clinton Administration with the US Office of Management and Budget, and the US Department of the Interior.

You can find their work on Substack at Defending Democracy.