Topline
President Donald Trump on Sunday defended his decision to impose broad tariffs on Canada, Mexico and China, acknowledging they may cause “some pain” but claiming it “will all be worth the price,” as the import taxes have been widely condemned by business groups and economists who warn they’ll raise prices for American consumers.
President Donald Trump speaks to reporters after signing a series of executive orders in the Oval … [+]
Timeline
Mexican President Claudia Sheinbaum issued a video message on X announcing the country will come out with more details Monday morning on its countermeasures against the U.S. tariffs, saying the country will “act with a cool head and love for the people” and arguing Trump’s claims the Mexican government is allied with criminal drug groups is “terribly irresponsible,” according to translations by Bloomberg and The New York Times.
Trump’s border czar Tom Homan told the Times in an interview that Canada has “taken steps” to address Trump’s concerns about immigration and drug trafficking, “but they haven’t taken enough steps,” adding that while Canada is “improving” its border security, Trump “doesn’t feel like they’ve done enough, and that’ll be his call.”
The Canadian government unveiled the full list of U.S. imports that the country will levy 25% tariffs on as part of its retaliatory measures against the U.S., which will apply to $30 billion worth of goods to start out with, including numerous food items, plastics, rubber, luggage, lumber, clothing, business supplies, glassware, appliances, furniture, cosmetics and more.
Homeland Security Secretary Kristi Noem acknowledged on “Meet the Press” that Trump’s tariffs could raise prices but said the blame would fall on other countries for not following Trump’s demands, rather than the president, encouraging other countries to “get on board and to make sure that they’re not pushing up prices” and claiming “if prices go up, it’s because of other people’s reactions to America’s laws.”
Canadian Ambassador Kristen Hillman told ABC News Canadians are “perplexed” and “confused” by Trump’s tariffs on the nation’s imports and argued it’s “hard to know what more we can do” to prevent the tariffs since the Canadian government has already been “leaning in hard” to appease Trump—but noted Canada does not intend to back down from its plan for retaliatory tariffs, as Canadians “are going to expect that our government stands firm and stands up for itself.”
Doug Ford, the premier of Canada’s Ontario province, said on X the region’s sole liquor wholesaler will remove American alcohol from its catalogs so that stores and restaurants in Ontario cannot stock any U.S. liquors—it follows similar moves from Nova Scotia Premier Tim Houston and British Columbia Premier David Eby, who banned his province’s Liquor Distribution Branch from buying American alcohol from “red states.”
The president defended his decision, writing on Truth Social, “WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT!). BUT WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID.”
Canada and Mexico both levied retaliatory tariffs on U.S. imports in response to Trump’s directive, while China said it would file a lawsuit with the World Trade Organization and take “countermeasures” in response to the move.
Trump imposed 25% tariffs on imported goods from Canada and Mexico—other than energy from Canada, which will be taxed at 10%—and an additional 10% tariff on goods from China, which he claimed was to hold the countries “accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country.”
Crucial Quote
“MAKE YOUR PRODUCT IN THE USA AND THERE ARE NO TARIFFS!” Trump said on Truth Social in defense of his tariffs. “WE ARE A COUNTRY THAT IS NOW BEING RUN WITH COMMON SENSE — AND THE RESULTS WILL BE SPECTACULAR!!!”
When Will Trump’s Tariffs Take Effect?
Trump’s tariff order will take effect Tuesday for duties that are levied on imported goods, except for any imports that were already in transit before Trump ordered the tariffs Saturday. Hillman told ABC News on Sunday the country is “hopeful” the tariffs will not take effect and the country’s government is “ready to continue to talk to the Trump administration about that,” though it’s unclear that Trump will negotiate at all on his plans.
What Impact Will Trump’s Tariffs Have On Prices And The Economy?
Trump’s tariffs on Canada, Mexico and China would effectively could cost each U.S. household more than $830 in additional taxes in 2025, according to an analysis released by the center-right Tax Foundation. The organization also predicted Trump’s plan would reduce the U.S.’ economic output by 0.4% and increase taxes in the U.S. overall by $1.2 trillion between 2025 and 2034. Economists have long warned Trump’s tariff plan would raise prices for American consumers—as the import taxes are paid by the U.S. companies that import foreign goods, which then pass on those costs to the consumer by raising prices—and a May analysis by the nonpartisan think tank Peterson Institute for International Economics (PIIE) concluded Trump imposing broad tariffs on imported goods would “[inflict] significant collateral damage on the US economy.” Goldman Sachs economists led by Ronnie Walker previously projected in April that prices on consumer goods would go up by 0.1% for every percentage increase in the effective tariff rate and raise inflation. In addition to imported goods, economists have predicted the price of domestic goods will also go up, as U.S. companies will “opportunistically” raise prices to take advantage of having less competition from imported products.
Will Trump Impose More Tariffs?
Trump has suggested he wants to impose universal tariffs on other countries’ goods, though it’s still unclear when that could happen or what any broader tariffs could look like. “I have it in my mind what it’s going to be but I won’t be setting it yet, but it’ll be enough to protect our country,” Trump said Monday about his plan to impose tariffs on all imported goods. The president told reporters Friday he plans on “doing something substantial” in terms of taxing European imports specifically, saying, “Am I going to impose tariffs on the European Union? Do you want the truthful answer or should I give you a political answer? Absolutely, absolutely.”
How Has The Business Community Responded To Trump’s Tariffs?
Business and manufacturing groups have criticized Trump’s tariffs, with U.S. Chamber of Commerce vice president John Murphy saying the move “is unprecedented, won’t solve these problems, and will only raise prices for American families and upend supply chains.” National Association of Manufacturers CEO Jay Timmons said the “ripple effects” of the tariffs “will be severe,” particularly for smaller manufacturers, warning, “Ultimately, manufacturers will bear the brunt of these tariffs, undermining our ability to sell our products at a competitive price and putting American jobs at risk.” Leaders of major companies have previously suggested Trump’s tariffs will lead to higher prices for American consumers, with Walmart chief financial officer John David Rainey telling CNBC in November the import taxes mean “there probably will be cases where prices will go up for consumers.” Best Buy CEO Corie Barry acknowledged on the company’s earnings call in November that most of its goods are imported from China and Mexico and any tariffs would likely result in higher prices, saying, “These are goods that people need, and higher prices are not helpful.”
Key Background
Trump has long vowed to impose tariffs on imported goods, even as economists and business leaders have decried the move. The president previously levied higher tariffs on Chinese imports during his first term, which sparked a trade war with China before the two sides reached a trade agreement in December 2019. While Trump long promised on the campaign trail to levy tariffs on imported goods, he only proposed 25% tariffs on Mexican and Canadian goods in November, which marked an escalation over the 10% to 20% he proposed pre-election. The president’s order Sunday comes after Trump said on his first day in office that he planned to impose the tariffs Feb 1, and imposed the broad tariffs with few restrictions despite earlier reports suggesting his administration was considering exempting certain imports or delaying the tariffs until March.
Tangent
In his Truth Social posts Sunday, Trump also reiterated his desire for Canada to become the “51st state,” claiming the country wouldn’t be “viable” if it weren’t for U.S. subsidies. Making it a U.S. state would mean “much lower taxes, and far better military protection for the people of Canada — AND NO TARIFFS!” Trump claimed. Canadian officials have strongly decried any suggestion the country should become part of the U.S., with Immigration Minister Marc Miller saying the suggestion is “beneath a president of the United States” and Minister of Intergovernmental Affairs Dominic LeBlanc saying the comments are “a way for [Trump], I think, to sow confusion, to agitate people, to create chaos knowing this will never happen.”
