‘Liberation Day’ at One Year

National Review Online

Monday, April 06, 2026

 

On April 2 of last year, President Trump stood in the White House Rose Garden and announced that he was liberating America from the scourge of imports. The charts he displayed — showing planned tariff rates on nearly every country in the world — sent stock markets tumbling. Trump’s declaration promised nothing less than a complete remaking of America’s place in the global trading system. Now, one year after that so-called liberation day, we can review the record of the president’s tariff regime.

 

Proponents of protectionism argue that economists were discredited by their dire predictions after liberation day, as the U.S. economy continues to grow and inflation has cooled. But avoiding disaster should not be the measure of sound policy. More importantly, the tariff rates outlined on liberation day were not the ones we got.

 

Trump claimed that the original rates were purely “reciprocal,” with countries facing the same average duties that they imposed on U.S. exports. In truth, the rates had nothing to do with existing trade barriers. Countries faced a minimum tariff of 10 percent, and many faced much higher rates based on a faulty formula. The resulting panic was so great that Trump suspended the tariffs to make time for “negotiations.”

 

Trump spent the following months changing his tariff policy dozens of times: decreasing and increasing rates, layering on produce-specific duties, and exempting various import categories. Exemptions became so porous that, by the end of 2025, the liberation day tariffs applied to just 42 percent of imports. The president also lowered tariffs on several major trading partners in a series of agreements. His administration fell far short, however, of reaching its stated goal of “90 deals in 90 days.”

 

Still, even if tariffs turned out lower than initially expected, Trump successfully raised the average tax rate on U.S. imports to the highest level since the Great Depression. Have the tariffs had the glorious effects that Trump and his allies said they would? Hardly.

 

First, Trump promised on liberation day that jobs and factories would come “roaring back” once a deadened U.S. manufacturing sector was protected from foreign competition. Yet after a year of high tariffs, manufacturing has shed tens of thousands of jobs, continuing a slide that began in 2023. Other blue-collar industries that rely on imports, such as construction and transportation, saw similarly weak employment.

 

Investment in building new factories also declined in 2025. Protectionists might contend that tariffs need more than a year to bring manufacturing home. But American manufacturers overwhelmingly view tariff policy as a headwind to manage, not a boon to celebrate. The uncertainty generated by ever-changing duties has killed their ability to plan new investments. Meanwhile, factories pay higher prices on the 56 percent of U.S. imports that serve as inputs for other products.

 

Research finds that tariffs are passed on to Americans at rates of up to 96 percent, rather than paid by foreign countries, as Trump claims. Tariffs have raised the prices of imported and domestic goods alike, as dampened competition allows U.S. producers to charge more. Merchandise prices are now around 6 percent higher than they would have been under pre-tariff trends.

 

Trump also said that the trade deals he negotiated using tariffs had brought in trillions of dollars of foreign investment. Those numbers were always fanciful. Foreign direct investment in 2025 was lower than in previous years, and most of it was in retained earnings rather than in new ventures.

 

As taxes on Americans, tariffs had one sure effect: they raised revenue. New levies brought in roughly $200 billion last year — but most of that money may need to be given back. Trump’s primary tariff tool was ruled illegal by the Supreme Court in February, prompting thousands of importers to sue for refunds. If they win in court, the tariffs might end up costing the government money, as companies will be owed billions of dollars in interest. Even if the government keeps all its ill-gotten gains, tariffs will have hardly dented the national debt.

 

Lastly, tariffs failed to alter the U.S. trade deficit — the object of Trump’s decades-long fixation. The trade deficit doesn’t harm anyone, but the president mistakenly believed he could reduce it by raising import costs. Instead, the goods deficit increased in 2025.

 

Although Trump’s country-by-country levies were struck down, he is reconstituting his tariff regime piecemeal — first through a temporary 10 percent duty across the board, then through phony investigations into foreign trade practices. Alas, the new tariffs will have the same impoverishing effects as the old ones for no discernible benefit. What were we supposed to be “liberated” from, again?