In an era defined by interconnected supply chains and mutual economic dependence, the resurgence of protectionism is not merely anachronistic — it is perilous. The recent decision by US President Donald Trump to impose sweeping tariffs — 25 percent on most goods from Mexico and Canada, and an additional 10 percent tariff on Chinese goods — sets a dangerous precedent. Framed as a response to migration and fentanyl, this unilateral maneuver risks cascading into a global trade war, threatening growth, reigniting inflation, and destabilizing decades of diplomatic progress. The stakes transcend partisan politics; they imperil the architecture of global commerce itself.  

Trump’s tariffs, justified under the guise of a “national emergency”, epitomize a tragic zero-sum worldview that conflates competition with existential threat. History and data alike refute this premise. When the United States levied tariffs on $155 billion of Canadian goods, Ottawa swiftly retaliated with matching duties on American products — from dairy to machinery — while urging citizens to boycott US goods. Mexico pledged similar countermeasures. These escalations echo the 2018-20 US-China trade skirmishes, which cost the average American household an estimated $1,277 annually in higher prices and reduced GDP growth by 0.5 percent, according to the Federal Reserve.  

The auto industry, a cornerstone of North American integration, now faces existential disruption. Vehicles and parts crisscross borders multiple times during production; a 25 percent tariff could paralyze this ecosystem, inflating costs for consumers and jeopardizing jobs. Canada’s oil exports, which supply 25 percent of US crude imports, face a 10 percent duty, threatening energy security and refining margins. As Ernst & Young Chief Economist Gregory Daco warns, such measures risk a “stagflationary shock”, slashing US growth by 1.5 percent while pushing Canada and Mexico toward recession.  

Nobel laureate economist Joseph Stiglitz, in his critique of the US-China trade war, dismantles the illusion that tariffs resurrect domestic industries or curb rivals. “Prosperity is not a finite resource,” he argues. China’s ascent — lifting 800 million people from poverty — was achieved through global integration, not isolation. Similarly, US efforts to constrain China’s tech sector via sanctions have accelerated Beijing’s push for self-reliance in semiconductors and artificial intelligence.  

Trump’s tariffs, targeting allies and rivals alike, ignore this lesson. By weaponizing trade unilaterally, the US undermines its own influence. Retaliatory measures from Ottawa and Mexico City — including Canada’s $155 billion tariff package — reveal a stark truth: Economic nationalism fractures alliances. The European Union, Japan, and the Association of Southeast Asian Nations, though spared in this round, now confront a destabilizing precedent. If the world’s largest economy abandons rules-based trade, what stops others from following?  

Trade wars are not abstract fiscal contests; they carry profound human consequences. Consider fentanyl: While Trump cites Mexico’s role in trafficking synthetic opioids, tariffs on medical supplies could hinder cross-border efforts to combat cartels. US farmers, already battered by China’s 2018 retaliatory soybean tariffs, now face Canadian levies on pork and wine, imperiling rural economies.  

The world cannot afford another misguided trade war — it is time to wisely and steadfastly choose collaboration over collision

Inflation looms large. The Peterson Institute for International Economics estimates Trump’s 2018 tariffs cost US consumers $51 billion annually. With new duties targeting everything from avocados to automobiles, American households and businesses brace for price hikes. Meanwhile, supply chain snarls — exacerbated by the COVID-19 pandemic-era disruptions — could worsen, stifling innovation and delaying critical goods.  

The solution lies not in isolation but revitalized multilateralism. As Stiglitz and renowned development economist Jeffrey Sachs emphasize, shared challenges — climate change, pandemics, AI governance — demand cooperation, not conflict. The US must reinvest in education, research and development, and infrastructure to enhance competitiveness, rather than scapegoating trade partners.  

Institutions like the World Trade Organization, though imperfect, remain vital arbiters. China’s pledge to legally challenge Trump’s tariffs at the WTO underscores the need for robust dispute mechanisms. Regional pacts like the United States-Mexico-Canada Agreement could serve as forums for negotiation, not retaliation.  

The 21st-century economy thrives on interdependence. A global trade war, as Trump’s tariffs portend, sacrifices long-term prosperity for fleeting political theater. Leaders must recognize containment strategies are obsolete; in a world where Canadian uranium fuels US reactors and Chinese batteries power American EVs, decoupling is a fantasy.  

The choice is clear: escalate tensions and invite stagflation, or embrace diplomacy and innovation. As Stiglitz cautions, “We will pay a high price if we try to delink our economies.” 

The world cannot afford another misguided trade war — it is time to wisely and steadfastly choose collaboration over collision.

The author is an economics and politics analyst, award-winning columnist for the Philippine Star and Abante, real estate entrepreneur and moderator of the Pandesal Forum.

The views do not necessarily reflect those of China Daily.