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3471As President Donald Trump rolls out sweeping new tariffs on major trading partners, Sen. Rand Paul (R-KY) is warning his party that the economic gamble could come with serious political consequences.
“Tariffs have also led to political decimation,” Paul said during an appearance on Fox News’ “The Ingraham Angle” on April 2.
“When McKinley most famously put tariffs on in 1890, they lost 50% of their seats in the next election. When [the] Smoot-Hawley [tariff act] put on their tariff in the early 1930s, we lost the House and the Senate for 60 years so they’re not only bad economically, they’re bad politically.”
Trump Declares ‘Liberation Day’
Paul’s comments came just hours after Trump signed an executive order imposing reciprocal tariffs on nearly every major exporting country.
The order calculates tariffs by taking the sum of a country’s own tariffs and non-tariff barriers against the U.S., and then charging half that amount on imports.
President Trump called April 2 “Liberation Day” and said the move marks the start of a new era for American manufacturing.
“It’s our Declaration of economic independence,” Trump said in the White House Rose Garden. “We began to make America wealthy again.”
Debate Over Tariffs and Economic Impact
But Paul pushed back, arguing that history shows tariffs have backfired both economically and politically.
He noted that past efforts to protect domestic industry through trade barriers often resulted in price hikes and retaliatory measures from trading partners.
Trump and his allies disagree. They say the policy will bring jobs back to the U.S., reduce dependence on foreign supply chains, and generate revenue to lower taxes and the national debt.
“Jobs and factories will come roaring back,” Trump said. “This will be indeed the golden age of America.”
Kevin Hassett, Trump’s former economic adviser, also defended the policy on the show. According to Hassett, real incomes didn’t go up for 16 years after China joined the WTO. “We were getting cheap goods, but we were losing jobs,” he said.
Ingraham echoed the sentiment, saying that globalization had “hollowed out” American manufacturing, and that Trump is now doing what he promised during his 2024 campaign.
Still, Paul isn’t convinced. He said tariffs not only hurt consumers and increase costs, but also create political backlash that Republicans may struggle to overcome.
“They’re not only bad economically, they’re bad politically,” he repeated.
Aggressive Tariffs Target U.S. Allies and Competitors
Trump’s new tariffs will hit countries like Japan, South Korea, and members of the European Union. China faces a 54% tariff, Vietnam is hit with a 46% rate, the European Union is subject to a 20% tariff, and Japan is facing a 24% tariff.
Even allies such as the United Kingdom and Taiwan are included under a baseline 10% tariff.
The policy also eliminates the $800 de minimis threshold, which allowed tariff-free imports under that value.
Supporters say this will close loopholes that cost the U.S. billions. Critics say it may raise prices for everyday goods.
Bailouts Undermine Tariff Revenue Claims
Despite claims that tariffs will flood the U.S. economy with outside revenue, the administration is already preparing emergency aid for struggling sectors.
Agriculture Secretary Brooke Rollins confirmed that bailout programs are being set up to “mitigate any economic catastrophes” facing farmers.
The U.S. Department of Agriculture has already authorized $10 billion in emergency income subsidies, mirroring a similar $28 billion package issued during Trump’s first term.
Trump has claimed the tariffs will generate so much wealth that the country “won’t know where to spend the money.”
But the bailout funds are being pulled from internal sources, like the Commodity Credit Corporation, which can borrow up to $30 billion from the Treasury.
Critics argue that this raises the question of whether the revenue is truly external or if taxpayers are footing the bill once again.
Global Retaliation and Long-Term Risks
Retaliatory tariffs from trading partners like China and the European Union are already underway, targeting key U.S. exports such as soybeans, poultry, and corn.
The American farm sector, which exported $176 billion worth of goods in 2024, could face permanent market losses if the trade war drags on.
As Republicans weigh their stance, the divide between economic nationalism and traditional free-market conservatism is once again front and center.
“Only one, Donald Trump, had the guts to try to dig us out,” Ingraham said, arguing that five American presidents contributed to the trade deficit.
But Paul’s warning stands as a reminder that bold moves on trade can come with a steep political price.
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