If it endures, Donald Trump’s decision on April 2 2025 to enact sweeping “reciprocal” tariffs on US trade partners will go down as one of the greatest acts of self-harm in American economic history. They will wreak untold damage on households, businesses and financial markets across the world, upending a global economic order that America benefited from and helped to create.

The president spoke brazenly from the Rose Garden at the White House on Wednesday, delivering a protectionist agenda well beyond most analysts’ worst-case scenarios. Within a week, the US will be enclosed by a minimum 10 per cent tariff wall on all imports, reinforced by hefty individualised duties on nations with sizeable US trade deficits. These build on levies already announced by the administration, including on China, Mexico, Canada and the auto industry. The combined effect will lift America’s effective tariff rate to its highest in over a century.

Trump’s justification hinges on a naive belief that treats trade imbalances as if they were the profit and loss account of a business, and not the culmination of highly specialised supply chains. He also considers factory work to be the fount of economic development, ignoring how decades of free trade has enabled America to rise up the industrial value chain and become a global leader in services and innovation.