The NPR Politics Podcast - Trump's Tariff Turnaround

Episode Date: May 12, 2025

After saying his tariff policies "will never change," President Trump announced he was reducing tariffs on imports from China from 145 percent to 30 percent. China, in turn, lowered its retaliatory tariffs. What's next? Then, previewing the president's upcoming trip to the Middle East. This episode: political correspondent Sarah McCammon, senior White House correspondent Tamara Keith, and senior political editor & correspondent Domenico Montanaro.The podcast is produced by Bria Suggs and edited by Casey Morell. Our executive producer is Muthoni Muturi.Listen to every episode of the NPR Politics Podcast sponsor-free, unlock access to bonus episodes with more from the NPR Politics team, and support public media when you sign up for The NPR Politics Podcast+ at plus.npr.org/politics.Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy

Tariffs, recessions, how Colombian drug cartels gave us blueberries all year long. That's the kind of thing the Planet Money podcast explains. I'm Sarah Gonzalez and on Planet Money, we help you understand the economy and how things all around you came to be the way they are. Para que sepas. So you know. Listen to the Planet Money podcast from NPR. Hi, this is Lisa in Charlottesville, Virginia. I just got back from Mother's Day weekend in Alexandria, Virginia, where I got to meet my brand new first grandchild, Charlie. This podcast was recorded at 1 06 p.m. Eastern time on Monday, May 12th, 2025.

Things may have changed by the time you hear it, but Baby Charlie will still be perfect in every way. Enjoy the show. Aww, congratulations. That's sweet. No better time to get Baby Charlie listening to the NPR Politics podcast than right now. Start them young. Hey there, it's the NPR Politics podcast. I'm Sarah McCammon. I cover politics. I'm Tamara Keith. I cover the White House. And I'm Domenico Montanaro, senior political editor

and correspondent. And today on the show, the US and China have agreed to a pause in the trade war. Tam, there's been significant movement on tariffs, especially when it comes to China. What's the latest? Right. So coming into this weekend, US tariffs on Chinese imports had been at 145%. China's tariffs on US imports were at 125%. It had been sort of a tit for tat retaliatory tariffs until they just got so high that it was impractical. After this weekend, trade talks in Geneva between US officials and Chinese officials, including Treasury Secretary Scott Besant. Now US tariffs on imports from China are 30%. That's much lower. China is imposing just 10% tariffs on US imports to China. That is a dramatic change. President Trump says, quote, we achieved a total reset with China.

This is for 90 days while the trade negotiators continue to talk about structural issues. Going down to 30 from 145 sounds like a big drop, but how different is this from what was in place with the Biden administration? Yeah, so I think that it is important to point out that if President Trump had just come out of the gate and said there would be across the board 10% tariffs all over the world and China would face 30% across the board tariffs, people would be freaking out. Economists would be warning about inflation and prices increasing on consumers and all of the things. But because he's coming down from a much higher place, then it seems low. So in terms of comparing it to the Biden area, it's actually really interesting. President Trump during his first

term did impose some tariffs on China. President Biden came into office, he did not roll those back. And in fact, he added more. He said that back in 2024, he changed the tariff rate to 100% on electric vehicles coming from China, 50% on solar cells, 25% on electric vehicle batteries. And they were planning additional tariffs on semiconductors, microchips. So I guess the difference is that in the Biden administration, the tariffs were more targeted. And then Trump came in and put into place across the board tariffs, not targeted. Well, just think about how many things we have that are made in China, right? I mean, almost everything that gets put under the Christmas tree or anything that you buy, right? And for those who were, you know, looking

at trying to buy fast fashion or goods that, you know, you can, you can, you know, buy a new wardrobe or get a new kitchen table, you know, even a 30% tariff on something made in China would mean like, you know, you go and buy, try to buy a $30 sweater, that's gonna be $39, right? That's still annoying, right? I mean, it's like more money, it's putting a pinch on people's pockets. And that was one of the big reasons why Trump was elected

in the first place is because people felt prices were too high and they're still gonna be high. President Trump was under a lot of pressure, whether he wanted to admit it or not. And he didn't want to admit it because he kept saying, this is worse for China than it is for us. I'd be happy if nothing came in from China because then we wouldn't be losing as much money to China.

I mean, just the other day, he was asked about port workers who are worried about their jobs because the big ships are not coming in loaded with goods from China. He was just very dismissive of the concerns that people had about the consequences of the tariffs. But now you see he's moved. So the markets responded positively to this news. Of course, the markets are not the same as the economy, but that's a positive sign from the market so far. You know, these are the world's two largest economies. Does this suggest that the two largest economies are ready to move forward in some way?

Certainly, it does. The fact that they have gone from triple digit tariffs down to double digit tariffs, that is certainly a sign of a de-escalation of what was an unsustainably escalated trade war, which at that point was essentially just a trade embargo where there would be no trade between these two countries, which was going to be very bad for the US and for China. They have found an off-ramp, at least for 90 days. They have 90 days to figure out where they land, but there are a lot of people who, if after 90 days, they didn't come to a deal, would be perfectly happy

to leave this the way it is, rather than going back up to the 145. It's undoubtedly good news that the two largest economies are stepping back from the brink of this trade war, because there are so many jobs, so many things that people buy in this country that are dependent on this relationship that the United States and China have that may be taking some time to figure out a more measured approach to this is going to be a good thing. I don't know if Trump or the White House will learn from this, but I think Trump and the White House think that Trump's approach was the right one because,

like Tam said, chaos kind of creates this urgency. And Trump certainly likes being able to do that to draw people's attention to it quickly. But undoubtedly good news that with so many people dependent on this relationship, that they look like they're taking the temperature down. Okay, time for a break. We'll have more in just a moment. And we're back. President Trump leaves for a trip to the Middle East today. It is his first major trip of his second term. Tam, you'll remember his first trip of his first term was also to the Middle East. I think you were on that trip. I was. Where exactly is he going? and what are you watching for?

Yeah. So he is going to Saudi Arabia, Qatar, and the UAE, the United Arab Emirates. And this is really all about business. And what I mean by that is these countries have promised to lavish President Trump with business deals for US businesses, arms manufacturers, and others. So in the case of Saudi Arabia, they have promised $600 billion in deals. And Qatar is promising $1.4 trillion over a 10-year period. So we're talking about a lot of money potentially here. You know, Trump really views the Middle East as a frontier to be mined, you know,

something that maybe past presidents haven't been able to go and get as much out of as he thinks that maybe the potential is there for. You know, and when Tam mentioned business, I mean, my first thought was, what about his personal businesses, right? I mean, I think that there's a degree to which his family is looking to invest in the Middle East and has invested in the Middle East and that how this sort of crosses over these goodwill relationships that Trump wants to build with these leaders in the region certainly no doubt would help his personal financial gain and his family's personal financial gain

But for the United States, you know, he feels like there's a lot more that the US could gain From the Middle East, you know I think the first thing that comes to most people's minds when they think about the Middle East right now is not Trump's business Dealings, but you know the war between Israel and Hamas and a number of other conflicts that are going on. Is this trip likely to move the needle at all in terms of those? Yeah, this is an interesting subtext to this trip. President Trump is not going to Israel. And that is notable on his first trip back in 2017, he did go to Israel. President Trump is very eager to get Saudi Arabia to normalize its relationship with Israel by signing on to the Abraham Accords, which were one of the big foreign policy accomplishments

of Trump's first term. But that's kind of a no-go right now because of the situation in Gaza. There was a bit of good news on that front announced. A dual Israeli and US citizen who had been held hostage in Gaza since October 7th was released today. But interestingly as part of negotiations between the US and Hamas not involving Israel directly. Yeah I think there's still like a big open question about what Trump's foreign policy vision really is and if there is one at all, because it doesn't seem that he really sees, you know, himself as someone who needs to lead ideologically what America means to the world and what he wants the other regions in the world to be.

He sort of sees these other places as, you know, resource-rich and how the U.S. can get what it wants out of that. It is interesting because a trip to the Middle East for a US president while there's a war going on, you would normally see that handshaking between the US and Israelis, maybe a big speech about what they think that the vision for the Middle East should be and what US role could be played, but we're not likely to see that at all and you know I also think it's partially reflective of a little bit of the tension between the US and Israel right now because Trump has wanted this peace deal to go through between Israel and Gaza so he could say he put an end to that war and

the right in Israel has not really allowed that to take place because it is still continuing to bomb in Gaza. So the trip comes as Air Force One is in the news. Some backstory here. President Trump, during his first term, placed an order for new presidential aircraft. They're still not here. So now he says he's considering an offer of a newer plane

from Qatar's Air Force. He talked about it earlier today. I would never be one to turn down that kind of an offer. I mean, I could be a stupid person and say, no, we don't want a free, very expensive airplane. But I thought it was a great gesture. And we should mention ABC News first reported that story. Domenico, what are the implications of this offer,

whether or not the White House actually goes through with accepting it? What are the implications for both offer, whether or not the White House actually goes through with accepting it? What are the implications for both Trump and for Qatar? Well, Trump gets a free, expensive plane, I guess, first and foremost. He doesn't like Air Force One. He thinks that it's kind of old, and that's why they've gotten new orders for an updated one. Qatar, of course, wants a bigger role on the world stage.

It certainly played a huge role in negotiations between Hamas and Israel, for example, and setting up that ability for the United States to be able to talk to Hamas directly, as we've seen happening. You know, and this is something we've seen Qatar do. The Qataris, you know, put this huge bid in for the FIFA World Cup that it won.

And despite all of the human rights issues in the country and the workers problems, that's how Qatar wants to put itself forward as a little bit more pro-Western and being able to form those relationships. The problem though is that Air Force One is not just supposed to be a flying palace, as Trump kind of put it. It has all these specifications that it would need to keep a president safe. And I think that even if they got this plane from Qatar, they'd still have to outfit it with some more things that the Secret Service and others would say, okay, now it's safe

for a president to fly this. But the ethics of this and the crossover of some of that is just so interesting that it's not seemingly a bigger scandal nowadays because Trump has crossed so many other lines when it comes to conflicts of interest. Right. I mean, he frames this as a simple question of getting something expensive for free. But Tam, the Constitution has something to say about this, doesn't it? Yeah.

In fact, those sorts of gifts are strictly forbidden. The US president cannot accept gifts from foreign governments. So let's just be clear about how this would work. It would be a gift from the nation of Qatar to the US military, not to President Trump. Then as Domenico says, it would have to be retrofitted to be Air Force One and not just an air palace without the technical specifications. So this is a complicated situation, never mind the ethics and legality, which are also extremely complicated. But then later, apparently the plan would be

to transfer this plane to the Trump Presidential Library, much like the Reagan Presidential Library has a version of Air Force One. The idea is that the Trump Library would have an Air Force One as well. But Trump was asked today, and he insisted that he would not use it personally after he leaves office, which had been

one of the questions about this. Yeah, you make such an interesting point, Tam. I mean, this arguably has to be one of the safest aircraft in the world with some of the highest national security implications, the ethical question questions notwithstanding. Yeah, and I will add that several Democratic senators are raising alarms. They put out a statement saying,

the Constitution is clear. Elected officials like the president cannot accept large gifts from foreign governments without consent from Congress. Air Force One is more than just a plane. It's a symbol of the presidency and the United States itself. This week, we will ask the Senate

to vote to reiterate a basic principle that no one should use public service for personal gain through foreign gifts. Senator Chris Murphy of Connecticut is also saying that he would block any arms sales to any country that gives gifts to the president like this. Okay, let's leave it there for today. I'm Sarah McCammon, I cover politics. I'm Tamara Keith, I cover the White House. And I'm Domenico Montanaro,

senior political editor and correspondent. And thank you for listening to the NPR Politics Podcast.