The main mystery of Trump’s tariff crusades: the “liberation date” and “mutual” obligations he is threatening is completely separate from what other countries are charging the US for our exports. In almost all cases, Trump’s tariffs are multiple times larger. How does he justify this huge bay? The President claims that it has been “teared” by blatant “non-tariff barriers” (NTBs), not excessive tariffs but by blatant “non-tariff barriers” (NTBs), including quotas and technical standards that systematically block goods from foreign markets, but we have opened America to “con artists” who lock us out.
In reality, Trump has it behind the scenes. The US is a much more enthusiastic user of NTB who feels he is more aggressive than just a handful of the world’s major economies.
How is the US protectionist?
A highly respected guide to where trade policies from different countries are on the spectrum from open to limit is the International Trade Barrier Index, edited by the Tholos Foundation, a Washington, DC, think tank focusing on tax reform and policy research. In 2024, Tholos data placed the United States as the 24th most protectionist economy in the world from a list of 88 countries, based on the number of trade suppressions imposed by countries. Overall, we are about 10% above the average in the overall limit. A roster featuring many bad actors. Tholos numbers make the US 60% worse than Japan and Canada, ranking third and fourth respectively. Less than UK 43%. About one-third of the average EU major. 15% are shy in Taiwan. Surprisingly, the survey found that the country has acquired as many protectionist measures as China. This has 11 spots from the bottom, with 70% of the bushes spreading at the end of India.
Clearly, the relatively strict American position across trade is not a matter of tariffs. on the contrary. According to the World Trade Organization, before the Trump trade war began, the US trade war appears to be welcoming a trade weighted average obligation on imports clearly 2.2%. WTO figures have set the average obligation charged by the top six US export buyers (Canada, EU, Mexico, China, Japan and the UK) at 3.2%. Big exception: As a result of the attacks during the first Trump administration, China and the US have established special punitive fees, accounting for an average of 14% of state exports and 12% of transport to the world’s second largest economy. Therefore, outside of trade disputes, the United States is an extremely low customs country, and the country we send most of our goods charges far less than we do.
So it is an indirect non-tariff barrier or NTB that shakes the US into a country that far more protects it from modest deployments of tariffs. In the same study, the Tholos Foundation tagged the US as the 15th largest user of NTBS, and only France, the Netherlands, the Czech Republic and Switzerland as the fifth-ranked user of major industrial forces beyond that. “For NTBS, the most active users are the US and the EU,” says Philip Thompson, policy analyst at Tholos.
Non-tariff barriers are very widespread
NTB comes in a variety of shapes. Includes practices such as quotas, technical standards, packaging, labeling, licensing, and safety requirements. In a 2024 survey, the St. Louis Federal Reserve reported that NTBs well cover more than two-thirds of imports of components, goods and finished products in 15 manufacturing sectors. The report points to a major contradiction between tariffs and NTBs in different industries. For the chemical and mechanical/electrical sectors, the US tariff rate is below 2%. However, NTB covered more than 70% of its sales. Same story about meat and vegetables: tariffs look like a 3% bargain, but more than 90% of the companies that those companies sell are under the umbrella of NTBS. Even what looks like free market wood is 1% obligation, with a third of US imports being shielded and mostly in sly. The paper concludes: “In contrast to tariffs, [NTBs] It is ubiquitous where we import in all industries. ”
The St. Louis Fed has found that around 20% of NTBs suffer from issues such as hygiene testing necessary to protect U.S. consumers and workers. (This study does not cover companies such as semiconductors where national security may be involved.) Instead, NTB’s dominance appears to “reflect the goal of protecting domestic industries from foreign competition,” and “distort and limit the scope of international trade.”
How the “customs rate quota” works
The United States is an avid user of protectionist tools called tariff fee allocation. Despite its name, TRQ is actually a non-tariff barrier, as it does not actually impose duties. TRQ usually allows a product or product to enter the country with tax-free at a certain level, and when an import hits its bogie, it causes high competitive tariffs, effectively stops the flow of rival products and goods from overseas, and enforces a fixed quota to protect domestic producers. The top example: a sugar market, by law, and by USDA regulations, limits production to keep its lowest prices generally higher than international markets. “The US government is a national leader in sugar cartels,” the Kato Institute’s investigation declared. Sugar TRQ is an important ingredient in its system to prevent cheap imported sugar from undermining guaranteed pricing.
In fact, TRQ is the main cash crop for agriculture in the United States. The US Trade Representative has published a list of TRQS, which is thorough. The specific goal is Australia. Faced with quotas for cream and ice cream, condensed milk, butter and many other agricultural commodities. Canada crashes into cheese, skim milk, butter and many other dairy products. Japanese TRQS cap beef and Peruvian cheese. Additional rules limit or block everything from Brazilian and Argentinean beef to tomatoes and blueberries, and Mexico to foreign sunscreen.
In his “mutual” tariff campaign, Trump has set a mandatory 245% in Taiwan, 24% in Japan, 10% in the EU, Canada and Mexico have set a mandatory 245% in China with 245% in steel, aluminum and non-US content. However, during normal times, these countries charge the US slightly higher tariffs than the US collects in exports, stacking up on non-arbitrary barriers that are much less than us. Trump’s best solution is to offer lower NTBs to raise prices for American consumers and to hinder our productivity in exchange for contracts from trading partners to lower their restrictions. The results would really illustrate the art of trading.
This story was originally featured on Fortune.com.
