Maintain US Global Influence Through Focused Trade Policies

This brief is part of “Election 2024: Policy Playbook,” a series by Rice University and the Baker Institute that offers critical context, analysis, and recommendations to inform policymaking in the United States and Texas.

The Big Picture

• A new U.S. administration may bring key changes to trade policies affecting the U.S. and its trading partners.
• Both candidates favor “America-first” trade policies, supporting tariffs on Chinese imports and restrictions on global steel and aluminum imports.
• A Trump administration may introduce more tariffs and offer uncertain support for Biden administration subsidies on computer chips and electric vehicles (EVs).
• Vice President Kamala Harris’ policies are likely to be consistent with President Joe Biden’s worker-focused approach, with steps to block imports of Chinese EVs and efforts to revise the USMCA in the 2026 review.

Summarizing the Debate 

Despite some differences in trade policies in 2025, many existing key elements will likely remain unchanged, regardless of who becomes president. Such policies are of vital importance not only to the U.S. and to its United States-Mexico-Canada Agreement (USMCA) partners, Canada and Mexico, but also to most other countries, given that the U.S. remains the world’s largest economy and maintains commercial ties with most nations. Moreover, the U.S. dollar remains the dominant international currency.

Expert Analysis

Common Elements 

The Biden/Harris and Trump trade policies, based on recent statements and past actions, share several common elements that are likely to continue regardless of who is elected president in November.

• Both administrations favor the 6-year-old “Phase One” tariffs of 7% or 25% tariffs on more than $350 billion worth of Chinese-source imports (with Biden adding 100% tariffs on any imports of Chinese-sourced autos) and the 10% and 25% tariffs (and some quotas) restricting steel and aluminum imports.
• Both presidential candidates — despite evidence that many American consumers prefer freer trade — have strongly backed “Buy American/Invest in America/Employ Americans” industrial policies, are skeptical of new trade agreements, and are committed to new steps to protect the U.S. auto industry and other manufacturing jobs.
• Trade relations with Mexico are likely to continue to be overshadowed to a significant extent by Mexico’s level of cooperation in reducing the flow of undocumented immigrants and illicit drugs to the U.S. and by increasing Chinese investment in Mexico.

Likely Trump Policies

Based on somewhat conflicting campaign promises, a second Trump term may be focused on trade, as was his first term. 

Tariffs. A new Trump administration could introduce 10% to 20% tariffs on global imports and an additional 60% tariff on imports from China. Such proposals may be serious or a negotiating strategy. No details as to permitted exceptions are currently available and the impact of these new taxes on the U.S. economy — and on U.S. agricultural and other exports because of retaliation by other trading partners — do not appear to have been considered. 

Alongside the proposed tariffs, Trump has said that he would welcome Chinese investment in auto production in the U.S., a policy that could engender opposition by both Democrats and Republicans in Congress on national security and other grounds.

Subsidies. The future of Biden administration subsidies for computer chips, electric vehicles, and EV batteries is uncertain. While Trump appears to oppose EV subsidies and other initiatives to address climate change, their economic benefits in red states such as Kentucky, Ohio, Tennessee, Georgia, Alabama, and the Carolinas, may make them politically challenging to eliminate.

Trade agreements. Based on his first term, Trump’s approach to negotiating trade and related issues with both allies and adversaries will likely tend to be combative rather than diplomatic.

• The mandatory 2026 USMCA review could turn into an attempted renegotiation of auto trade rules and other issues with Canada and Mexico, possibly including threats of U.S. withdrawal from the agreement. 
• The prospect of withdrawing from the World Trade Organization (WTO) or further limiting U.S. participation also seems likely.
• Multilateral efforts aimed at non-binding accords such as the Indo-Pacific Economic Framework (IPEF) and the Americas Partnership for Economic Prosperity (APEP) could be terminated or ignored under Trump.

Likely Harris Policies

Harris’ policies will likely align with Biden’s, with a strongly professed focus on workers. 

Tariffs. If the issue has not been resolved by January, Harris will likely take steps to block U.S. imports of Chinese EVs from Mexican factories, possibly through 100% tariffs. The China tariffs imposed by Biden (7%–25% on most goods, 100% on EVs) will be continued. New tariffs on other trading partners are not likely.

Subsidies. A Harris administration would maintain the subsidies designed to encourage manufacturing of chips, EVs and EV batteries in the U.S., and consumer subsidies that support retail sales of EVs to combat climate change.

Trade agreements. Harris’ general approach to trade agreements is also likely to emphasize continuity, with these expected actions.

• Participating in the WTO without any expectation of resolution of differences among members on dispute settlement, industrial subsidy rules, fisheries subsidies, or developing country status.
• Recognizing the USMCA’s huge economic importance to the U.S. and taking part in the 2026 review, despite having opposed the agreement in the Senate, possibly seeking to make the USMCA auto rules of origin even more favorable to the U.S. 
• Engaging with IPEF and APEP partners without improving their U.S. market access, offering political support but limiting the economic impact, and continuing to avoid traditional free trade agreements.

Policy Actions

This section focuses on feasible policy actions within the current political climate. The recommendations acknowledge that neither administration is likely to resolve WTO stalemate or negotiate major trade agreements.

1. Avoid imposing new tariffs and quotas, as foreign retaliation could severely impact inflation and competition in the U.S. economy, with the possible exception of limited national security-based measures concerning China.
2. When broadening protectionist trade policies that seek to expand manufacturing employment (which comprises only about 8.5% of the U.S. workforce), consider the negative impact of those policies on the agricultural sector, as well as millions of service workers — many of whom typically spend most of their weekly paychecks on food, clothing and shelter.
3. Support the reauthorization of the Generalized System of Preferences (GSP) and the African Growth and Opportunity Act (AGOA), recognizing that these unilateral benefit programs are important to dozens of developing countries, many of which are becoming increasingly aligned internationally with China rather than the U.S.
4. Promptly reengage with the WTO and U.S. allies on possible plurilateral agreements. These include an e-commerce agreement to prohibit most data localization requirements, protect freedom for cross-border data flows, protect the confidentiality of source code, and bar customs duties on e-commerce goods. Such a policy change on issues of concern to high-tech companies would assist in preserving U.S. leadership in the tech revolution. 
5. Recognize that the only viable path for new WTO agreements lies in plurilaterals, those supported by the majority of, but not all, members.
6. Begin immediate analysis of U.S. priorities for the mid-2026 USMCA review/renegotiation, with full Congressional, business, citizen, and other stakeholder input, focusing on EV trade and USMCA non-compliance by Mexico.
7. Ensure prompt confirmation of ambassadors to the dozens of developing countries whose appointments are stalled in the Senate. This would enable U.S. embassies in those nations to better promote exports and enhance competition, economic and political, with China, by gaining the support of both the countries’ people and their governments.

The Bottom Line

Regardless of partisan differences on some issues, but with bipartisan support of a protectionist U.S. industrial policy, there are multiple trade policy steps that either new administration can take to protect and help grow the U.S. economy, preserving America’s global economic power and influence.

This material may be quoted or reproduced without prior permission, provided appropriate credit is given to the author and Rice University’s Baker Institute for Public Policy. The views expressed herein are those of the individual author(s), and do not necessarily represent the views of Rice University’s Baker Institute for Public Policy.