Trump's 25% Tariffs A 'Self-Inflicted Wound,' Says Economist Amid Warnings Of Fewer American Jobs — Peter Schiff Says You'll Pay More For Cars And Homes (CORRECTED)

Editor's Note: A typographical error in the headline of this story has been corrected.

Leading economists criticized former President Donald Trump‘s plan to reimpose 25% tariffs on metal imports, while U.S. steel stocks rallied sharply during Monday’s trading session amid expectations of reduced foreign competition.

What Happened: Former Treasury Secretary Larry Summers warned the proposed tariffs would lead to “fewer American jobs, more American inflation, and probably a bigger trade deficit,” questioning potential national security benefits from tariffing allies.

Jason Furman, former Chair of the Council of Economic Advisers under former President Barack Obama, called the policy a “self-inflicted wound” that would raise input costs for American manufacturers.

Steel stocks responded positively to the announcement, with Cleveland-Cliffs Inc. (NYSE:CLF) surging 23%, while Nucor Corp. (NYSE:NUE) and Steel Dynamics Inc. (NYSE:STLD) gained 6.52% and 5.75% respectively. United States Steel Corp. (NYSE:X) advanced 6.63%, and Century Aluminum Co. (NASDAQ:CENX) rose 14.1%.

The tariffs announced by Trump would apply to all countries without exemptions. The policy mirrors his 2018 measures that imposed 25% duties on steel and 10% on aluminum imports, citing national security concerns.

Market analyst Peter Schiff cautioned about broader economic implications: “Everything that American companies manufacture or build that requires steel or aluminum, such as cars, aircraft, appliances, and houses will cost more.”

See Also: Oil Prices, Energy Stocks Jump As Gaza Ceasefire Risks Collapse On Rising Hamas-Israel Tensions

Why It Matters: Benn Steil, director of international economics at the Council on Foreign Relations, noted the disproportionate impact on Sunday, citing that “Steel-using firms employ over 5 million Americans… Steel-intensive industries account for over 20% of U.S. manufacturing output.”

The impact could be particularly significant for U.S.-Canada trade relations. According to U.S. Census Bureau data, Canada exported $11.2 billion in steel and $9.5 billion in aluminum to the U.S. in 2024. Canadian Innovation Minister Francois-Philippe Champagne emphasized the critical role of Canadian metals in U.S. defense and manufacturing sectors.

The automotive industry, which employs 7 million Americans, could face significant challenges from higher material costs. European steelmakers, including German manufacturer Salzgitter, warned the tariffs could redirect excess global supply toward their markets, potentially destabilizing international trade dynamics.

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