A look at Trump’s first 100 (are we missing a zero?) days in office

United States President Donald Trump speaking at the White House in Washington, D.C. Photo by JIM WATSON/AFP via Getty Images

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United States President Donald Trump marked his first 100 days in office on Tuesday, a symbolic milestone observed in the U.S. to gauge a president’s early headway on fulfilling their campaign promises. Here, the Financial Post looks at Trump’s progress and his effect on key economic issues to date.

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Trade and tariffs

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For years, Trump has repeatedly claimed the U.S. was being “ripped off” by other countries through what he perceives as unfair trade practices. During his presidential campaign, he promised to levy sweeping tariffs on foreign-made goods in a bid to revive American industries and encourage U.S. investment.

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Trump followed through on his tariff promise — though the process hasn’t exactly been straightforward. Since he first announced his tariff plans for Canada and Mexico, there have been two 30-day reprieves, the imposition of 25 per cent tariffs on Canadian goods (10 per cent on energy products), an exemption on CUSMA-compliant goods, and further tariffs on steel and aluminum and foreign cars.

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Then came the expansive global reciprocal tariffs announced on April 2 (so-called “Liberation Day”), which were then paused and reset for 90-days after a week of steep declines in the stock and bond markets.

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Trump’s aim with the tariffs is two-fold: reshore and rebuild America’s manufacturing sector, and help fund his signature tax cut agenda.

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On the first point, economists estimate it would take years for the U.S. to disentangle itself from a hyperconnected global economy and even longer to rebuild domestic production. They also question whether such a complex and lengthy undertaking would result in enough number jobs to make it worthwhile.

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Revenue-wise, the U.S. Treasury Department collected an additional US$6.3 billion from tariffs in April, a tiny fraction of its overall revenue of US$4.9 trillion last year — US$2.4 trillion of which came from income taxes.

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Trump has also floated the idea that tariffs could replace income taxes, an idea that Tax Foundation senior economist Erica York told CNN is “absurd” and “mathematically impossible.” According to the Financial Times, “at the current rate of $16 billion in monthly tariff collection, it would take 150 months, or more than 12 years, to replace the annual revenue generated by the income tax.”

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A Barron’s analysis also noted that “fully replacing income taxes would require an average tariff rate of 74 percent — a level economists say would effectively sever the U.S. from global trade.”

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Inflation

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The U.S. headline inflation rate hit a 40-year high in June 2022, rising to 9.1 per cent, amidst surging commodity prices due to supply chain issues related to the global pandemic and war in Ukraine.