Tariffs are going to have a negative impact on the United States (US) economy and international relations because they are going to cause inflation and cause deterioration of international trade and relationships.

One of the main policies of the second Trump administration are tariffs. Tariffs are a tax that is placed on imported goods from other countries. 

As of August 7th, 2025, the most notable tariffs in place by the Trump administration are 25% on Mexico, 30% on China, 35% on Canada, 15% of most European countries and 50% on Brazil and India.

The problem with tariffs is that they are mostly paid by the consumer, not the supplier or corporation. The only possible way consumers avoid paying tariffs is price controls, which is not a viable solution, because price controls themselves come with a set of negative consequences. 

If prices are higher, consumers are less likely to buy the product. This is the first sign of an unhealthy economy. This creates a trickle-up effect, where corporations bring in less money because people are simply not buying their products.

This is also bad for the government because the corporate tax revenue decreases. The only way the government can counteract that is by raising the corporate tax rate, which discourages business growth and may cause corporations to move their headquarters to tax friendly nations.

Donald Trump has also expressed strong support for small businesses. Tariffs are going to ruin small businesses because if prices go up and consumers do not buy from them, they will go out of business because they need consumers.

Tariffs will also have a negative impact on international trade. Other countries are unlikely to trade with a country who is an unreliable partner.

The US has completely destroyed their relationship with Canada. This has mainly happened due to comments made about making Canada the 51st US state, but tariffs have also played a role. The US and Canada used to have a free trade agreement, but now the implementation of tariffs has caused hostility.

Also tariffs on Latin American countries are bad, like Mexico and Brazil, because if they see the US as unreliable, they will just be pushed farther into becoming allies with China, who has heavily invested in the region with their Belt and Road Initiative.

The US economy and international relations are going to be negatively impacted due to higher prices and a deterioration in international trade and relationships.

Image courtesy of Harris Wacaster ’28.