HOW COUNTRIES ARE RESPONDING TO TRUMP’S “LIBERATION DAY” TARIFFS

Cruz pushed back on the idea that tariffs could continue for up to a decade, saying he thinks it is “a mistake to assume that we will have high tariffs in perpetuity.” 

“I don’t think that would be good economic policy. I am not a fan of tariffs,” the Texas senator told Kudlow, saying he would rather cut taxes for citizens.

The best-case scenario for the steep tariffs Trump placed on nearly every country on Wednesday is that “they serve as leverage to lower tariffs across the globe,” Cruz hoped. A “bad outcome,” he warned, is that foreign countries respond to the economic levies with counter-tariffs of their own on U.S. goods, which the senator feared would “jack up” prices for American consumers. 

“Time is going to tell in the next month or two or three what happens if the result of yesterday’s [tariffs] announcement is a lot of our trading partners across the globe dramatically reduce the tariffs they charge on U.S. goods and services and the consequence of that is the U. S. government dramatically cuts the tariffs that were announced yesterday,” Cruz said. “That would be a great outcome. That would be good for America.” 

But, he added, “If the result is our trading partner jack up their tariffs and we have high tariffs everywhere, I think that is a bad outcome for America.” 

“Tariffs are a tax on consumers, and I’m not a fan of jacking up taxes on American consumers so my hope is these tariffs are short-lived and they serve as leverage to lower tariffs across the globe,” Cruz concluded. 

Trump has faced widespread criticism, even from some members of the GOP, for tariffs against Canada, which were announced in February, and his subsequent “Liberation Day” tariffs on many countries, including top allies, that were announced on April 2. The stock market’s plunge and reportedly increased chances of recession have further stoked fears that the tariffs will lead to economic fallout. 

WHICH PRODUCTS WILL SEE HIGHER PRICES FROM TRUMP’S TARIFFS ON CANADA AND MEXICO?

The White House has argued that tariffs can launch a new era of American wealth and prosperity, citing studies such as a 2024 analysis by the Coalition for a Prosperous America that concluded a global tariff of 10% would grow the U.S. economy by $728 billion, create 2.8 million jobs, and increase real household incomes by 5.7%.

Trump’s executive order outlining the “Liberation Day” tariffs justified his action due to “a national emergency arising from conditions reflected in large and persistent annual U.S. goods trade deficits, which have grown by over 40 percent in the past 5 years alone, reaching $1.2 trillion in 2024.”