The Evolving Shape and Effects of Recent U.S. Tariff Policy

The protectionist turn of U.S. trade policy over the last decade has increasingly involved major tariff increases on the imports of specific industries, and the full range of U.S. trade partners. Ironically, as observed by Farrell and Newman (2025), the deep integration of the post–World War II era has enabled the United States and other trade nations to weaponize the interdependence that underpins the globalized economy. To understand the potential impacts of the recent changes in U.S. trade policy, this paper first analyzes the reorientation of U.S. imports away from China that followed the U.S.–China trade war. In this case, even after many years, the decoupling has been partial, rather than complete, with import responses corresponding to the economic costs and incentives of supply chain trade. The lesson of this event is that more recent trade policy shifts will also bring partial, but not complete, decoupling, and that the full economic response will unfold over time rather than immediately. While the ultimate responses will only emerge over time, long and unresolved U.S. trade policy uncertainty will erode U.S. trade connections with the rest of the world.