In my years serving on the House Ways and Means and Budget Committees, I have seen firsthand how trade policies impact the American economy. President Donald Trump's recent address to the joint session of Congress reaffirmed his commitment to reciprocal tariffs, a strategy aimed at correcting trade imbalances and protecting U.S. industries.
While tariffs can be a brilliant negotiation tool, we must be careful not to rush into them blindly.
I support the president's "America First" economic policies, particularly when it comes to ensuring that trade deals are fair to American businesses and workers. For decades, foreign competitors have taken advantage of weak U.S. trade policies, using unfair practices to flood our markets with cheap goods while restricting access to theirs.
The result has been the loss of millions of American manufacturing jobs, shuttered factories, and an economy increasingly dependent on foreign supply chains. This must change, and President Trump's use of tariffs can be a smart strategy — if applied correctly.
The Dual Nature of Tariffs
Historically, tariffs have been used to generate revenue and protect domestic industries from unfair foreign competition. When applied strategically, they can be an effective means of compelling other nations to amend unfair trade practices and open their markets to American goods.
Trump's push for reciprocal tariffs ensures that the U.S. is not at a disadvantage when other nations impose unfair duties on our exports.
However, tariffs should never be used as a crutch to balance the economy.
The prior administration's policies have exacerbated inflation, driven up the national debt, and weakened American manufacturing. Reckless spending, overregulation, and a failure to prioritize domestic energy production have put unnecessary strain on our economy.
In this environment, we must be especially careful not to impose tariffs in a way that further burdens American businesses and consumers.
Using Tariffs as a Negotiation Tool, Not a Blunt Instrument
Tariffs are most effective when used as leverage in negotiations, not as a long-term economic strategy. The administration should focus on employing them to achieve specific objectives rather than as a blanket solution.
For example, targeted tariffs against China and Mexico to address illegal fentanyl production serve a legitimate national interest. The opioid crisis is one of the most serious threats to American lives today, and if tariffs help force China and Mexico to crack down on fentanyl production, they are being used properly.
I have seen how tariffs, when used effectively, can force countries like China to negotiate better trade terms. The Trump administration's tariffs on Chinese goods exposed Beijing's reliance on unfair trade practices, including intellectual property theft and forced technology transfers.
As a result, China was brought to the table, leading to the Phase One trade deal. This was an example of how tariffs can work — but it also showed that tariffs should have an end goal, not be used indefinitely.
Avoiding the Pitfalls of a Prolonged Trade War
While I support President Trump's use of tariffs as a tool to correct unfair trade practices, I also caution against overusing them. A full-scale tariff war can be damaging if not managed properly.
History has shown us that retaliatory tariffs can quickly escalate, leading to significant economic harm. But as is often the case, as a shrewd negotiator, the end game Trump plays is often not what it appears to be at the beginning.
The Smoot-Hawley Tariff Act of 1930 is a perfect example of how a poorly managed tariff policy can backfire. Initially intended to protect American farmers and manufacturers, it instead triggered a wave of retaliatory tariffs from other countries, leading to a collapse in global trade and worsening the Great Depression.
While our economy today is very different, the principle remains the same: Tariffs, when used recklessly, can do more harm than good.
American businesses depend on international trade, and an all-out trade war could disrupt critical supply chains, increase costs for manufacturers, and ultimately raise prices for consumers. The Biden administration has already failed to control inflation, and we cannot afford to set economic conditions into a trajectory of going from bad to worse by overusing tariffs.
Encouraging Presidential Leadership in Trade Policy
As someone who has worked extensively on economic policy, I urge President Trump to continue using the power of the presidency to push for fair trade agreements rather than relying on tariffs as a long-term punitive measure. The "bully pulpit" of the presidency is a powerful tool, and it should be used to rally support for better trade deals that benefit American workers and businesses.
By leveraging tariffs as a negotiating tool rather than an economic weapon, the U.S. can achieve its trade goals without unnecessarily harming its own economy. Trade negotiations require a mix of strength, diplomacy, and strategic patience.
President Trump has the ability to bring America's trading partners to the table and demand fairness without pushing the U.S. into an unsustainable trade war that Democrats could exploit in the 2026 midterm elections.
Jim Renacci was raised in a blue-collar union family, pursuing the American dream, leading to his operating over 60 businesses, creating 1,500 new jobs, and employing over 3,000 people. As a four-term conservative U.S. congressman, Jim served on the powerful Ways and Means and Budget Committees, cutting government spending.
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