OPINION
President Trump’s Economic Strategy: Tariffs, Trade Wars, Reasserting U.S. Power
This past Saturday, President Trump imposed tariffs on Mexico, Canada and China, a bold reaffirmation of his America First economic strategy.
By targeting key industries — steel, aluminum, and automobiles — he signals that weak trade deals and unchecked foreign competition are over.
He acknowledged short-term strain but insists long-term benefits will outweigh costs.
Trump's approach may be seen as bold and controversial by critics, but for him, it extends beyond trade — it's a strategic effort to reinforce national strength and secure economic independence.
Backlash from Canada, Mexico: Swift, Predictable
Justin Trudeau, the weak embattled Prime Minister of Canada, set to leave office in weeks, denounced the tariffs and retaliated immediately.
However, Shopify CEO Tobi Lutke, one of Canada’s billionaires, criticized Trudeau for failing to prevent a trade war, arguing that Canadians want their government to meet Trump’s demands declaring, "Win by helping America win. Trump believes that Canada has not held its side of the bargain."
In 2023, Canada and the U.S. traded $1,077B in goods and services.
Canada exported $593B and imported $484B, resulting in a $41B U.S. trade deficit. Canada sent 77% of its exports to the U.S., mainly crude petroleum, cars and gas.
Mexico’s left-wing Socialist-Democratic President, Claudia Sheinbaum, who took office in October 2024, also threatened retaliatory tariffs.
Mexico is U.S.'s top goods trading partner, with two-way trade surpassing $800 billion, eclipsing China. Nearly 80% of Mexico’s exports—$500 billion—go to the U.S., while just 15% of U.S. exports — $276 billion — flow south.
Neither Sheinbaum nor Trudeau has leverage to withstand a prolonged economic battle.
When Trump imposed tariffs in 2018, both pushed back — yet within six months, he set the terms of a new trade deal.
This time, it won’t take anywhere nearly as long, and if they don’t adapt quickly, tariffs could double.
Moment of Unmatched Resilience
On a personal level, as I picture the attempted assassination of Trump in July 2024, in Butler County, Pennsylvania, a moment that shook the nation, I remember not just the gunfire, the chaos, or the tragedy of those injured and lost — but the moment Trump rose up.
Bloodied but unbroken, he stood, fists clenched and roared to the crowd, "Fight, fight, fight!" Does Trudeau or Sheinbaum honestly believe they can outlast someone who, even after staring death in the face, refused to fall?
Trump’s Return to the White House: Swift, Decisive
In two weeks, Trump reversed policies that left America vulnerable to unchecked migration, foreign economic coercion, and diplomatic weakness.
He signed dozens of executive orders, conditioned foreign aid, and reshaped trade relationships—all to prioritize American workers.
Unlike past administrations that relied on ineffective diplomacy and empty promises, Trump is making it clear that America’s interests come first—and that economic power will be used as leverage to protect them. This approach extends beyond North America.
U.S. Counters China’s Growing Influence in Latin America
In a decisive move against China’s expanding economic footprint in Latin America, Secretary of State Marco Rubio embarked on his first overseas trip this past weekend, beginning in Panama — a crucial gateway for global trade due to its strategic control of the Panama Canal.
His mission includes stops in Costa Rica, El Salvador, Guatemala, and the Dominican Republic, signaling a renewed U.S. focus on regional security and economic realignment.
Over the past decade, China has heavily invested in Panama’s ports and logistics hubs, expanding its regional influence with little opposition—until now.
Rubio’s visit signals a shift.
China’s Economic Playbook in Latin America
China’s economic expansion in Latin America has been driven by massive investments in infrastructure, energy and natural resources.
Under the Belt and Road Initiative (BRI), Beijing poured billions into transportation networks, ports and energy projects, solidifying its influence in a region historically aligned with the U.S.
A key battleground is lithium mining, where China has secured long-term supply agreements and expanded processing capacity in Argentina, Bolivia, and Chile — nations that hold over 50% of the world’s known lithium reserves.
Beyond lithium, China has expanded its stakes in Latin American trade infrastructure, funding major port and logistics projects.
While these investments have boosted local economies, Beijing’s growing influence has now raised alarms in new Washington. China’s unchecked control over critical infrastructure could allow it to manipulate trade routes or exert strategic leverage in ways that threaten American interests.
Panama Canal: Strategic Crossroads and U.S. Leverage
The Panama Canal, built by the United States from 1904 to 1914 at a cost of $375 million (about $11 billion today), remains one of the world’s most vital shipping routes.
The Torrijos-Carter Treaties of 1977— which returned control of the canal to Panama in 1999 — granted the U.S. the right to intervene militarily if its neutrality is threatened or if trade is unfairly obstructed.
If China or any other nation attempts to restrict access or manipulate trade routes, the U.S. could invoke treaty provisions to ensure the canal remains open to all nations during peacetime.
Trump demands China’s removal from the Panama Canal area or warns of U.S. action. In a major shift, after Rubio’s meeting with Panamanian President José Raúl Mulino on Sunday, Panama announced it would not renew its Belt and Road Initiative agreement with China and may terminate it early.
However, Trump escalated his stance, that the Status Quo was unacceptable. threatening to reclaim the canal.
Trump’s Economic Doctrine: No More Free Lunch
Trump’s foreign policy strategy extends beyond securing better trade deals—it is a direct challenge to China’s influence and a reassertion of American dominance in Latin America.
One of Trumps first victories since returning to office came when Colombia’s left-wing president, Gustavo Petro, attempted to block the return of deported criminals and undocumented migrants in late January.
Previous administrations might have backed down, but Trump threatened to reconsider U.S. trade benefits and financial aid.
Within hours, Colombia reversed its position — deportations resumed and a full agreement was reached.
Similarly, last week, Trump revoked Biden’s Temporary Protected Status (TPS) for 600,000 Venezuelan migrants, clearing the way for their deportation.
A day later, Venezuela agreed to accept its illegal migrants back, including members of the notorious Tren de Aragua gang, following negotiations led by Rubio.
The announcement comes on the heels for a meeting between US enjoy Richard Grenell and Venezuelan dictator Nicolas Maduro on Friday — with Grenell returning to the US with six American citizens who had been detained in the South American country.
The Monroe Doctrine Reimagined - The Trump Doctrine
The Monroe Doctrine (1823), introduced by President James Monroe, warned European nations against colonizing or interfering in the Americas, establishing a precedent for U.S. dominance in Latin America.
China’s aggressive economic expansion has brought a 21st-century challenge to this doctrine.
Under Trump’s leadership, the U.S. is now actively pushing back against Chinese economic control.
His strategy is not just about tariffs, trade deals or border enforcement—it's a fundamental reassertion of American power.
Nowhere is this more apparent than in Latin America, where Trump’s renewed Monroe Doctrine approach is limiting Beijing’s ability to dictate trade and infrastructure development, forcing strategic realignments, and restoring U.S. influence in a region that had grown accustomed to American passivity.
At the time of this writing, Monday Feb. 3, 2025: Mexican President Sheinbaum announced a one-month delay on U.S. tariffs after reaching agreements with President Trump, including deploying 10,000 National Guard troops to strengthen Mexico’s northern border and curb drug trafficking, particularly fentanyl.
The Art of the Deal Redux Washington Edition
Trade relationships are being restructured, strategic resources protected, and Beijing will not dictate economic policy in a region that has historically been within America’s sphere of influence.
Critics argue this approach to trade and foreign policy will isolate the U.S.
But reality is this strategy is already compelling governments to reconsider positions and redraw the global balance of power, wielding economic strength as both a weapon and a shield.
For decades, the global elite championed economic globalization and diplomatic multilateralism as the only viable path forward. Trump has never subscribed to that.
Leaders who try to resist this new reality will face its impact.
All opinions in the preceding column are those of the author.
Richard Torrenzano is chief executive of The Torrenzano Group. For close to a decade he was a member of the NYSE management (policy) and executive (operations) committees. His new book, "Command the Conversation: Next Level Communications Techniques," launches in March. Mr. Torrnezano is a sought-after expert and leading commentator on artificial intelligence, cyber and digital attacks; financial markets; brands, crisis, media, and reputation.
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