Donald Trump's 100% tariff threats against BRICS could seriously backfire

Donald Trump has announced the threat of 100% tariffs on imports from BRICS countries unless they commit to the perpetual superiority of the US Dollar in international trade.

There’s nothing new about Donald Trump threatening extreme protectionist measures against other countries, in fact he’s about to shatter the USMCA trade agreement by imposing 25% tariffs on the United States’ neighbours and allies Mexico and Canada.

However the extreme threat of 100% tariffs on products from Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, UAE, Iran, Indonesia, and a multitude of other BRICS aligned economies just goes to show how threatened his administration feels by any kind of transnational economic cooperation that doesn’t involve the United States.

Despite all of Trump’s assurances (lies) that the tariffs he imposes will be paid by the countries he’s trying to economically sanction, the reality is that they’ll be paid by US businesses and citizens when they purchase imported products.

Raising the price of imported goods via tariffs incentivises consumers to buy domestically produced goods and services by making them artificially cheaper, however it’s impossible to boost US output overnight, so more tariffs mean more price rises.

And 100% tariffs would mean that prices would literally double.

Take China as an example. Over the last few decades US capitalists have made fortunes by closing down domestic production and importing from China instead, where lower wages, weaker regulation, and poorer environmental standards mean much higher profit margins.

In 2023 China exported $501 billion in goods and services to the US, while the US exported $147 billion to China in return, meaning the US trade deficit with China is over $350 billion.

If Trump were to impose 100% tariffs on Chinese imports, that would end up lumbering US consumers with hundreds of $billions in extra taxes.

Then bear in mind that it wouldn’t just be China either. If you add up US imports from the BRICS member states alone (setting aside the 9 partner states and 8 more that have applied for membership), it adds up to over over $660 billion per year in imports.

It’s beyond fantastical to imagine that US companies that rely on Chinese manufacturing and $160 billion+ in imports from other BRICS member states would be either capable of, or willing to close down their overseas operations and build replacement factories in the US overnight, so prices will go up.

You can’t just expect production to shift back to the United States overnight. Neither for high tech electronic components, nor cheap mass produced consumer goods.

You can’t just slam the door shut on global supply chains and expect factories producing hundreds of $billions worth of goods to spring up in your own country overnight.

Who is going to pay for their construction? Who is going to staff them? Who is going to train up all of these new workers, especially in high tech manufacturing and services? Who is going to cover the additional costs of the required machine tools if they’re produced in countries that are subject to Trump’s sanctions? Where are the raw materials that the US cannot produce for itself in sufficient quantities (rare earth metals for example) going to come from?

Trump’s repeated threats to impose tariffs are akin to the behaviour of a local mob boss trying to bully their local community into conformity. Either everyone does as he says, and conduct business through his cartel, or they suffer reprisals and punishment beatings.

And the punishment beatings aren’t just being meted out on rival economies like China either. Trump’s economic sanctions on Mexico and Canada illustrate the fact that the new US administration is prepared to sanction and destabilise its allies, as well as geopolitical rivals.

There are quite obvious parallels between Trump’s tariffs and Brexit. Both raised trade barriers between themselves and their neighbours; both have been sold to the public with a pack of outright lies about the consequences and exaggerations of the benefits; both can be seen as self-applied sanctions with dramatic effects on domestic businesses that rely on imports and exports; and both diminish the country’s reputation and diplomatic standing by unilaterally tearing up previously agreed treaties and agreements.

Then there’s the fact that previous US attempts at protectionism have backfired spectacularly, like the embargo on the sale of advanced AI chips to China, which seemed to force the Chinese into coming up with better and more efficient AI language models, and the $1trillion implosion of US tech stocks after the release of DeepSeek-R1.

It’s vanishingly unlikely that countries that are targeted by Trump’s tariffs would just lie down and take it, without replying with tit-for-tat tariffs of their own, which would seriously damage US exports.

And seeking to bully other countries into subservience to US interests could end up being highly counter-productive to the stated aim of weakening BRICS.

If the US gains the reputation of a bully that purposefully disrupts and damages other countries economies to pursue their own agenda, or simply due to the whims of their unstable and unreliable President, doesn’t that make it more likely that countries will turn towards BRICS for stability and mutually beneficial trade, rather than against it?

Wouldn’t Trump’s trail of disruption and broken trade agreements hasten the development of a global currency "to replace the mighty U.S. Dollar" rather than dissuade it?

Take a look at how the World has changed since the beginning of the neoliberal era in 1980 when China was a trading minnow compared to the United States.

By 2018 China was already doing more trade than the United States with well over half the countries in the world.

If the United States becomes a global bully that doesn’t just destabilise China and its allies on the whims of its increasingly deranged President, but attacks its own allies and trading partners like Canada and Mexico too, doesn’t that further strengthen the Chinese?

If the US seeks to bully a country into coming over to their side of Trump’s new isolationist iron curtain with the threat of tariffs, but China is their bigger trading partner, and doesn’t resort to intimidation and threats of economic destabilisation, who are they likely to choose?

It seems that all China and BRICS need to do for now is to maintain respectful relations with their trading partners and offer a stable alternative to increasingly erratic Trumpian chaos, and they get to expand their sphere of influence by default, right? 

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Rachel Reeves' "new approach" is just "more of the same"

In her latest economic speech Rachel Reeves claimed that "at the election people voted for a whole new approach". That’s possibly true, although a more realistic interpretation could be that Labour won by default because the Tories imploded, and millions stayed at home in despair at the lack of alternatives to the failing status quo.

Even if we accept Reeves’ interpretation of the election result at face value, it’s still deeply problematic.

If people "voted for a whole new approach" then where are the new ideas? Where are the policies designed to make life better for ordinary people? And why does Rachel Reeves’ economic rhetoric sound indistinguishable from the succession of Tory Chancellors who preceded her?

Let’s look at some of the Labour government core positions under Keir Starmer’s leadership.

Austerity

One of the first things Rachel Reeves did was to launch another economically debilitating round of austerity cutbacks, pinning blame on the previous government for her actions.

That’s pretty much identical to George Osborne’s strategy in 2010, of blaming Labour’s supposed economic mismanagement for his ruinous programme of austerity cuts.

Conclusion: "More of the same"

Privatisation profiteering

Starmer’s Labour outright refuses to countenance taking vital services and infrastructure away from parasitical privatisation profiteers to run them as not-for-profit public services.

In fact Starmer’s health secretary Wes Streeting is salivating at the mouth at the prospect of carving the NHS open for even more private profiteering, to the benefit of several private health figures who have donated hefty sums to Starmer’s front bench.

Even Labour’s renationalisation of the railways is a sham which keeps the trains and freight services under the control of greedy private profiteers.

Labour are on the side of the privatisation profiteers, just like the Tories before them.

Conclusion: "More of the same"

Wittering on about "growth"

Rachel Reeves keeps going on and on about creating "growth" but without setting out any kind of realistic framework to get the economy growing in real terms, and without defining any redistribution strategy to ensure that any additional growth isn’t simply hoovered up by greedy corporations, exploitative landlords, financial speculators, and the tax-dodger brigade, leaving the rest of us even deeper in the mire of inequality.

Without redistribution policies Reeves’ "growth agenda" amounts to the same old trickle down economic bunk that neoliberal political grifters have been spouting for decades.

’Just let the rich get richer, and eventually some of it will trickle down to plebs like you’ - It didn’t work in the 1980s, it didn’t work in the Tory austerity years, and it’s not going to work now.

Conclusion: "More of the same"

Child impoverishment

One of Keir Starmer’s first acts as Prime Minister was to purge seven Labour MPs from the parliamentary party for the crime of voting to scrap the Tories’ diabolical poverty-spreading Two Child Policy.

Recent research from the Joseph Rowntree Foundation shows that child poverty is due to rise in England and Wales under Starmer’s leadership, due to Labour’s draconian welfare policies.

Meanwhile in Scotland, child poverty rates are set to fall as the SNP government works to mitigate the terrible consequences of Reeves’ poverty-spreading agenda.

If Labour were to follow the SNP example and scrap the Two Child policy, it’d raise 800,000 kids out of poverty, but they don’t want to do that because they’re too busy pandering to the rich.

Labour aren’t just sticking with Tory child-impoverishment policies, they’re wittering on about how growth is magically going to fix everything while a third of all British kids grown up in poverty.

Conclusion: "More of the same"

Welfare scapegoating

One of the most depraved things about the 2010-2024 Tory governments was the way they continually attacked the most vulnerable people in society. Not just whipping up public hate against the poor, the unemployed, and the disabled, but implementing cruel and draconian policies to drive the most vulnerable people in society deeper into destitution (Bedroom Tax, Two Child Policy, Benefit Sanctions, "Fit For Work" assessments …).

Rachel Reeves has been copying from the same Tory playbook by distracting from her own economic failings by whipping public resentment against disabled people, and pledging yet another round of austerity cuts to the disability welfare system.

Conclusion: "More of the same"

The panacea of deregulation

Reeves bangs on and on about deregulation, as if giving powerful corporations even more leeway to do whatever they like is magically going to result in prosperity for the rest of us.

Look at the Grenfell tragedy. Look at our rivers and coastal waters full of raw sewage. Look at the life-ruining Post Office Horizon scandal. Look at the outrageous P&O sackings. Look at the collapse of Carillion. Look at the orgy of corruption going on in Teesside.

Who on earth thinks that any of these things would be have been made better by even less regulation than there was?

And who can forget David Cameron endlessly fulminating against "red tape" and promising a "bonfire of regulations".

How is Reeves’ anti-regulation rhetoric any different from what came before?

Conclusion: "More of the same"

Brexit

Reeves only mentions Brexit once in her speech to say "we are pragmatic about the challenges that we have inherited from the last government’s failed Brexit deal".

But what does this even mean?

Keir Starmer whipped Labour MPs into backing Boris Johnson’s Brexit shambles, and he’s repeatedly insisted that the country is stuck with it now, and there’s nothing to be done to try and mitigate the damage.

How can anyone give a speech on "growth" without acknowledging the diabolical impact that Brexit has had on the British economy?

It doesn’t matter how many pensioners, children, and disabled people Reeves drives into destitution in her cruel and counter-productive austerity book-balancing exercises, when the Brexit sanctions we applied on ourselves are such a massive millstone on the UK economy.

Conclusion: "More of the same"

More of the same

In conclusion Reeves is pretending to offer the change that she says the British public wanted, but in reality whole swathes of her speech, and Labour’s policy agenda are indistinguishable from the rhetoric and policies of preceding Tory governments.

And when people are handed the cold gruel of "more of the same" when they’ve been promised that everything will change for the better, that’s the environment of disillusion that the extreme-right absolutely thrive in.

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Capitalism vs Socialsm

The vast majority of British people prefer public ownership of vital infrastructure and services like energy, the NHS, water, and public transport.

The Westminster establishment cabal and their capitalist backers prefer privatisation profiteering, so that's what we're stuck with.

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