Did Trump’s Tariffs Kill Economic Populism or Globalisation Itself?

Introduction

On 12 April 2025, a detailed analysis in The Guardian asked a blunt question: Did Donald Trump’s tariff blitz just destroy the very economic populism that brought him back to power — and badly damage globalisation in the process?:contentReference[oaicite:0]{index=0}

After a self-declared “liberation day” of aggressive new tariffs and a rapid partial retreat, markets, allies and rivals were left wondering whether they had just witnessed a turning point in the post-war trading order. The average effective U.S. tariff, even after a pause, still sits at levels not seen since the early 1900s, and trust in America as the anchor of global trade has taken a visible hit.:contentReference[oaicite:1]{index=1}

This article breaks down what happened, why it matters for both economic populism and globalisation, and what governments, businesses and citizens can do to navigate this new landscape.

Key Points

1. A “Liberation Day” That Backfired

Trump framed his sweeping tariff hikes as a moment of liberation from an unfair global trading system, tightening duties across a wide range of imports under the banner of protecting American workers and punishing China.:contentReference[oaicite:2]{index=2}

But the week did not play out as scripted:

• Financial markets sold off sharply, especially U.S. Treasuries, signalling deep concern over the speed and scale of the shift.:contentReference[oaicite:3]{index=3}
• The White House was forced into a 90-day pause on some of the new measures after the market backlash, undermining the narrative of total control.:contentReference[oaicite:4]{index=4}
• Even with that retreat, the average effective U.S. tariff remains about 27%, the highest since 1903, according to analysis cited from the Yale Budget Lab.:contentReference[oaicite:5]{index=5}

Instead of a clean victory for economic populism, the week exposed the limits of shock-and-awe trade policy when global finance pushes back.

2. Economic Populism Meets Market Reality

The article argues that it may not be globalisation but economic populism that took the most damage:

• Trump pitched tariffs as a way to restore factories and middle-class jobs, but broad, abrupt hikes spooked investors and drove up uncertainty.:contentReference[oaicite:6]{index=6}
• Wall Street and global markets effectively vetoed a “full-on kamikaze mission” against the existing trade order by making the cost of unilateral disruption immediately visible.:contentReference[oaicite:7]{index=7}
• The episode shows how financial markets can discipline populist experiments when they threaten the plumbing of the global economy rather than just its rhetoric.

The result is a paradox: economic populism promised to tame globalisation, but in practice it collided with the very system it relies on for capital, demand and growth.

3. Globalisation’s Foundations Are Shaken

Even with the partial U-turn, the analysis stresses that globalisation itself is now structurally weaker:

• Globalisation depends on trust, stable rules and predictable alliances that allow long, complex supply chains to function. That trust has been eroded by sudden tariffs, threats, and politicised trade decisions.:contentReference[oaicite:8]{index=8}
• Leaders such as Canada’s prime minister Mark Carney and UK prime minister Keir Starmer are quoted as effectively declaring that the U.S.-anchored trade order of the last 80 years is over — not as a passing phase, but as a historic break.:contentReference[oaicite:9]{index=9}
• Nobel laureate Paul Krugman is cited lamenting that the careful, rules-based tariff system built since the 1930s has been “burned down”, signalling what he sees as an abdication of U.S. leadership.:contentReference[oaicite:10]{index=10}

In other words, even if tariffs are tweaked or scaled back, the psychological and diplomatic damage to the post-war model of open trade may endure for decades.

4. A Wider Protectionist Wave

Trump’s tariffs don’t exist in a vacuum. The piece situates them inside a wider surge of protectionist and security-driven trade measures worldwide:

• Since the global financial crisis, countries have constantly added tariffs, non-tariff barriers, export controls and investment screens, fragmenting trade. In 2024 alone, more than 3,000 trade-restricting measures were introduced globally.:contentReference[oaicite:11]{index=11}
• Governments increasingly justify restrictions under national security, from semiconductors to critical minerals, blurring the line between economics and geopolitics.:contentReference[oaicite:12]{index=12}
• Concepts like “friend-shoring” and “near-shoring” encourage firms to reorganise supply chains around allies rather than pure cost efficiency, accelerating the retreat from hyper-globalisation.:contentReference[oaicite:13]{index=13}

The Trump shock is thus both a symptom and an accelerant of a broader shift toward a more fractured, risk-aware trade system.

5. Why This Matters Beyond Washington and Beijing

The consequences stretch well beyond the U.S.–China axis:

• Export-oriented economies that grew rich inside the old system — from Germany to South Korea — must rethink their growth models in a world where trade is more politicised and volatile.:contentReference[oaicite:14]{index=14}
• Smaller countries find themselves squeezed between great-power blocs, forced to pick sides on technology, energy and security issues that used to be mostly commercial.:contentReference[oaicite:15]{index=15}
• For companies and workers, the new era means more frequent shocks — sudden tariffs, sanctions, supply chain disruptions — and a premium on resilience over pure efficiency.

How To: Navigate a Post-“Liberation Day” Global Economy

The big question is: what can different actors do now that the fragility of both economic populism and globalisation is out in the open?

For Governments

1. Shift from Shock Therapy to Predictable Strategy

• Replace surprise tariffs and abrupt policy shifts with clear, rules-based frameworks that signal how trade tools will be used and under what conditions.
• Use targeted measures tied to specific security concerns rather than broad, economy-wide hikes that spook markets and allies.

2. Invest in Domestic Safety Nets and Competitiveness

• If globalisation has left parts of the population behind, the remedy is better social insurance and active labour market policies, not just tariffs.
• Channel resources into:
  • Skills training for displaced workers
  • Regional development in de-industrialised areas
  • Innovation and infrastructure that make domestic production genuinely competitive

This tackles the grievances that fuel populism without blowing up the global trading system.

3. Rebuild Trust With Allies

• Coordinate trade responses with partners instead of treating allies like adversaries at the border.
• Strengthen plurilateral clubs (small groups of like-minded countries) that can agree on standards for digital trade, green goods and critical technologies, even if a universal system stalls.

For Businesses

1. Build “Plan B” (and C) Supply Chains

• Map critical components and identify where single-country or single-supplier dependencies could become political choke points.
• Develop redundant, regionally diverse sourcing options, even at slightly higher cost, to reduce vulnerability to tariff shocks or sanctions.

2. Integrate Geopolitics Into Risk Management

• Treat trade policy, sanctions risk and great-power competition as core business risks, not background noise.
• Establish regular scenario exercises:
  • “What if a 20% tariff appears overnight on our key import?”
  • “What if we lose access to a major market for a year?”

Use these to stress-test balance sheets, logistics and customer relationships.

3. Communicate Transparently With Customers and Workers

• When tariffs or trade ruptures force price changes or production shifts, explain clearly why decisions are being made and how the company plans to adapt.
• Involving workers in restructuring plans early can reduce resistance and preserve institutional knowledge.

For Citizens and Workers

1. Recognise the Trade-Politics Link

• Understand that debates about tariffs and globalisation are ultimately about jobs, prices and local communities, not just abstract GDP figures.
• Pay attention to how different policies:
  • Affect consumer prices
  • Influence local employment in tradable sectors
  • Change a country’s leverage in global negotiations

2. Invest in Portable Skills

• In a world of shifting supply chains and politicised trade, skills that travel across sectors and borders are a key safety net:
  • Digital literacy
  • Languages
  • Management and problem-solving abilities
• Lifelong learning becomes essential as industries exposed to trade are more frequently restructured or relocated.

3. Look Beyond Simplistic Narratives

• Economic populism often promises quick fixes: one tariff, one wall, one trade deal that will “bring everything back”.
• Reality is more complex: local prosperity depends on a mix of openness, fairness, innovation and social protection, not a single border measure.

Conclusion

The events surrounding 12 April 2025 mark more than just another twist in the U.S.–China trade saga. They suggest that economic populism, when translated into blunt tariff warfare, can collide head-on with the very global system it seeks to bend — and emerge weakened.:contentReference[oaicite:16]{index=16}

Trump’s attempted “liberation day” ended in a partial retreat under market pressure, leaving tariffs still historically high but confidence in U.S. leadership and in globalisation’s stability significantly lower. The deeper story is not about one politician or one country; it is about a world where trust, rules and shared prosperity can no longer be taken for granted.:contentReference[oaicite:17]{index=17}

Going forward, the path out of this impasse will not come from nostalgic visions of a closed, self-sufficient economy nor from a naïve return to the hyper-globalisation of the 1990s. It will require:

• More targeted, predictable trade policies,
• Stronger domestic safety nets and competitiveness,
• And a renewed effort to align openness with fairness.

Whether we call it the end of economic populism or the end of old-style globalisation, one thing is clear: the next trading order is being written now, in boardrooms, ministries and voting booths around the world. How we respond will determine whether this moment becomes a slow unwinding of prosperity — or the start of a more resilient, inclusive global economy.