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What Could Progressive Tariffs Actually Look Like?

12 10
09.04.2025

Free trade critics on the left fought a lonely battle against a powerful bipartisan consensus for decades, trying to convince the U.S. political mainstream that tariffs could be used as a tool to restore American industry, help American workers, and set global labor and environmental standards.

Tariffs came back into action during Donald Trump’s first term and under Joe Biden. Trump tried to use the tariffs as leverage for a trade deal with China that produced few results. Biden sought to marry tariffs on Chinese goods with an industrial policy aimed at growing domestic capacity in sectors such as clean energy and semiconductors.

Biden’s supporters say those policies were starting to bear fruit — but could have gone farther.

Now, Trump is taking a chainsaw to Biden’s industrial policy by halting green energy grants promised under the Inflation Reduction Act and attacking the bipartisan CHIPS Act. He is also ratcheting up tariffs so high that economists of all stripes are warning of recession.

In an interview, one of the most prominent boosters of Biden’s trade policy outside the administration discussed his fears about how the Trump tariffs will play out. Todd Tucker, the director of the industrial policy and trade program at Roosevelt Institute, said Trump’s approach to tariffs could set back the effort to put progressive trade policy in place by decades.

This conversation has been condensed and edited for clarity.

For a long time, the conventional wisdom about tariffs has been highly skeptical. I’m thinking about Ben Stein’s scene talking about the Smoot–Hawley Tariff Act in “Ferris Bueller’s Day Off.” How did that conventional wisdom come to be?

If we go back in U.S. history, Trump is often fond of talking about the 1890s as some sort of peak moment, and that’s because we didn’t have the progressive income tax, but we did have tariffs.

Depending on the day, he says it’s great because we collected revenue, or it might be because we were able to build Hamiltonian industries. He will pivot back and forth on what the justification is. Of course, that was not a great time for all Americans: Jim Crow, massive inequality, robber barons.

Tariffs were the main instrument that especially the Republican Party was advocating to promote domestic industry. That sort of came to a head with the Smoot–Hawley tariff in 1929, which by some measures was the highest tariff in U.S. history — certainly one of the highest tariff hikes in U.S. history — and it was attributed, in part, with worsening the Great Depression. It did not cause the Great Depression, because it had already started before that, but it certainly did not help lessen the Great Depression either.

There began to be a reappraisal of tariffs in the 1930s. FDR and Truman saw value in using selective reductions from high U.S. tariffs as a way to reward allies that we wanted to negotiate trade deals with. FDR negotiated dozens of trade agreements with all sorts of countries.

Then, in the late 1940s, they kicked that to a multilateral level by establishing the General Agreement on Tariffs and Trade, which became the multilateral forum to do what FDR had previously been doing bilaterally. Congress asserted a lot more control over the trade policy than they do today. There were hearings all the time on, like, “Do we want to change the rates on autos so we can address this competitive challenge we’re seeing from Japan?”

In the 1970s, that started to shift with the rise of neoliberalism. All sorts of government activism in the economy began to be frowned upon. Financial regulation was frowned upon, use of tariffs was frowned upon, and there started to be put into place a variety of different mechanisms to constrain government in their interventions in the economy.

You took what had been basically boring, vanilla reductions in tariffs under the early GATT negotiation rounds, and it started to become using tariff reduction as the mechanism to constrain........

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