The United States’ long-term trade deficits desperately need to be addressed and tariffs are powerful strategic tools for reindustrializing America, securing supply chains, and generating revenue. However, CPA cautions against adopting a reciprocal tariff strategy aimed at negotiating lower foreign trade barriers and more favorable investment conditions abroad — typically referred to as “market access.” 

A reciprocal “market access” tariff strategy that prioritizes foreign governments’ willingness to reduce their trade barriers or be more receptive to foreign investment is in conflict with the stated goals of the America First Trade Policy Memorandum and undermines the predictability and stability American businesses need to confidently invest in long-term domestic production. Indeed, reciprocal market access was the intention and the outcome of the modern trade agreement era. Our dozen free trade agreements with twenty countries all offer reciprocal duty-free treatment on over 99% of products.

This is a failed approach. Instead of a surplus, these free trade agreements have resulted in a high trade deficit and immense import pressure on U.S. producers. While the United States believes in free market competition, other countries believe in national champions. No set of rules written in an agreement will change this reality. And this reality is why reciprocal market access commitments always fail. U.S. tariff policy therefore must be determined by the needs and issues of American industry and workers; not by the legalistic promises from foreign governments.

For these reasons, CPA recommends an 18% universal revenue tariff approach as a base revenue generator for the federal government and a starting floor for protecting U.S. industries and promoting domestic investment and production. A tariff floor of 18% to generate revenue for the U.S. government from imports and relieve the tax burden of U.S. taxpayers — especially working-class Americans — is directly in line with President Trump’s America First Trade Policy. 

Furthermore, U.S. trade protections must apply globally, not only to a select “Dirty 15” countries. Countries where the U.S. has the highest trade deficits are certainly some of the biggest problems, but they are by no means the only problems. The U.S. still has large trade deficits with many countries not on this “Dirty 15” list, such as Oman, who are particularly harmful to U.S. producers for specific products, — steel pipe in Oman’s case. The total trade deficit by country is only part of the picture which is why the U.S. needs a comprehensive trade policy approach.

The 18% universal tariff floor is only the starting point. China and other connector countries with extensive links to Chinese supply chains, transshipment, and export dumping warrant even higher rates to further protect U.S. producers from below market prices caused by China’s industrial overcapacity. For these reasons, CPA recommends China receive a 60% tariff rate. Furthermore, imports from Foreign Entities of Concern (FEOCs) in designated connector countries such as the Southeast Asia ASEAN group that China uses as a transshipment hub should also be subject to the 60% tariff. As Chinese entities continue to try to evade U.S. tariffs via new connector countries, this designated list of connector countries must be updated accordingly over time.

In addition to the base revenue tariff, CPA also recommends a comprehensive, industry-specific tariff and quota approach to address the unique issues faced by each U.S. production sector. A single product can have both a revenue tariff and protective tariff, by setting the in-quota tariff at a revenue rate, and the over-quota tariff at a protective rate. 

Conversely, reciprocal tariffs expressed as a flat percentage across all imports  will not address the long-standing trade issues with steel imports from Mexico. In 2019, Mexico agreed to limit steel exports to the U.S. based on historic trade levels in exchange for an exemption from the  Section 232 steel tariffs. However, Mexico never upheld their end of the deal and the U.S. did not have an automatically enforced quota either. Given the massive import surge from Mexico since the exemption was granted (500%+ for many products like steel conduit), a value-based (ad valorem) reciprocal tariff will not stop this issue or many other product/industry issues. Each industry requires specific and comprehensive protection in order to rebuild a successful and sustainable U.S. industry. Mexican steel imports, for example, need U.S.-administered quotas based on historic pre-surge (2015-2017) import levels as well as weight-based $/kg tariffs to combat undervalued customs declarations.

The U.S. needs a strategic industry-by-industry tariff approach. By setting tariff rates by industry, instead of by country, the U.S. can efficiently protect against imports causing the most harm to U.S. producers (such as Mexican steel). This approach also avoids collateral damage to tariff preference programs that prioritize U.S. content, notably the  “yarn-forward” rule of origin for apparel made with American textiles.

This tracker highlights these needs and issues across the U.S. industrial base. It will be updated continuously to reflect evolving trade and industrial issues critical to the United States, but is by no means a comprehensive list of all the trade issues U.S. producers face domestically or the barriers, subsidies, and other support foreign countries provide to their own industries.