By Charles Switzer
10:16am PDT, May 7, 2025
Trump's New Justification for Tariffs
President Donald Trump has presented a new rationale for his tariff hikes, suggesting that it is necessary for more products to be manufactured within the United States to ensure national security, DailyMail.com reported.According to Trump, this is part of a broader strategy to prepare the country in case of a future war. Speaking on Air Force One on Sunday, May 4, he emphasized the need for American-produced pharmaceuticals, stating, "We're going to have our drugs made in the United States so that in case of war, in case of whatever, we're not relying on China and various other countries, which is not a good idea."
This rhetoric seems to align with his broader goal of reducing reliance on foreign imports and ramping up domestic manufacturing, but his casual mention of war has many on edge.
Here's what's happening.
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Economic Concerns and Global Reactions
Donald Trump's comments come at a time when his trade policies, particularly the tariffs imposed on foreign goods, are causing concern in the U.S. and abroad.While Trump insists that these measures will lead to greater self-sufficiency, Chinese President Xi Jinping warned that there are no winners in a trade or tariff war.
In an editorial published during his Southeast Asia tour, Xi said, "There are no winners in a trade war, or a tariff war." He further urged both nations to "safeguard the multilateral trading system" and emphasized the importance of "stable global industrial and supply chains" along with "an open and cooperative international environment."
Tariffs and Their Impact on Global Trade
China has long been a key target of Donald Trump's trade policies, and the ongoing tariff war is taking a toll on the global supply chain.In response to U.S. tariffs, China suspended exports of certain rare earth minerals and magnets, which are critical for industries such as automotive manufacturing, semiconductors and aerospace. These minerals play an essential role in vehicle motors and other high-tech components.
Trump's top economic advisor, Kevin Hassett, acknowledged the impact of these actions, describing them as "concerning" and noting that the administration is exploring alternatives to help U.S. businesses that rely on Chinese supplies.
"Rare earths are a part of lots of the economy. It's a little bit of the value add to the US economy, but a crucial part of the value added," Hassett said. He also added that efforts are underway to help small businesses find alternative suppliers outside of China, though it remains a complicated issue.
"The White House is concerned about China. Period," he further stated, highlighting the ongoing tensions between the two nations.
The Potential for More Tariffs
As the tariff war continues, Donald Trump has indicated that more tariffs are likely to be implemented soon.Specifically, he mentioned that semiconductor tariffs will "take place in the very near future."
However, Trump expressed some flexibility regarding tariffs on products such as iPhones and tablets. "The tariffs will be in place in the not-too-distant future," he said, adding that there would be discussions with companies to ensure a level of flexibility in the process.
"Nobody should be so rigid," Trump remarked, leaving open the possibility of adjustments based on discussions with businesses.
Growing Concern About a Recession
The ongoing tariff war and its potential to cause economic instability have led to growing concerns within corporate America. A recent survey of more than 300 CEOs revealed that 62 percent of business leaders believe the U.S. is on the brink of a recession or economic downturn within the next six months.This figure marks an increase from 48 percent in March, according to reports.
Ray Dalio, founder of Bridgewater Associates, expressed his concerns during an interview on NBC's Meet the Press, saying, "Right now, we are at a decision-making point and very close to a recession."
"I'm worried about something worse than a recession if this isn't handled well," he added.