The Double-Edged Sword of Trump's Tariffs: Environmental Whispers Amid Economic Pain

Newsweek

21-05-2025

The Trump administration's recent tariffs on imported goods, primarily framed as economic nationalism to correct trade imbalances, have an often-overlooked aspect: potential environmental co-benefits in greenhouse gas (GHG) emissions and fast fashion waste. Societally, it is useful that these environmental co-benefits may occur, especially when the administration is actively anti-GHG mitigation and has left the Paris climate agreement.
There is value to exploration of these minor and likely temporary environmental advantages against the significant co-costs to labor, livelihoods, and the broader sustainable transition. While a superficial view might see an environmental silver lining, a deeper look reveals these benefits are overshadowed by detrimental economic and long-term environmental progress impacts.
The Murky Silver Lining: Environmental Co-Benefits?
Tariffs increase the cost of imported goods, typically leading to a reduction in international trade volume. This decrease in cross-border movement directly correlates with lower GHG emissions, particularly from the significant shipping and transportation sectors. Rob Jackson, head of the Global Carbon Project, a group of scientists who monitor greenhouse gas emissions yearly, noted that these tariffs may reduce emissions temporarily due to an anticipated economic downturn. This temporary dip results from reduced industrial output and consumption, lessening the demand for transporting raw materials and finished products globally. Proponents also argue that pricier imports could incentivize domestic manufacturing, potentially shortening supply chains and reducing the carbon footprint associated with complex global production. Localized production would eliminate extensive international shipping, thus lowering transportation emissions.
President Donald Trump speaks during a 'Make America Wealthy Again' trade announcement event in the Rose Garden at the White House on April 2, 2025, in Washington, D.C.
President Donald Trump speaks during a 'Make America Wealthy Again' trade announcement event in the Rose Garden at the White House on April 2, 2025, in Washington, D.C.The tariffs are also expected to impact the fast fashion industry, known for its environmental consequences from overproduction and rapid disposal of clothing. The elimination of the de minimis exemption, which previously allowed low-value packages to enter the U.S. duty-free, directly increases the cost of fast fashion items from major online retailers like Shein and Temu, heavily reliant on direct-to-consumer shipments from China. The expectation is that higher prices will make frequent purchases of cheap, trendy clothing less appealing. Fashion industry experts and environmental advocates hope this price increase could shift consumer behavior toward fewer, higher-quality, and more durable garments, ultimately reducing textile waste in landfills. Additionally, more expensive new clothing due to tariffs might increase the popularity of the second-hand clothing market, further contributing to a more circular fashion economy by extending garment lifespans.
The Sharp Edge: Co-Costs to Labor and Livelihoods
Despite the superficial environmental benefits, the economic realities for American and international workers and consumers present a less optimistic picture. Tariffs on imported components and materials are expected to negatively affect employment in U.S. industries relying on these inputs, as increased costs could diminish their global competitiveness. A Goldman Sachs analysis suggests a potential net negative impact on overall U.S. employment of approximately 400,000 jobs. Even when the tariffs do create jobs in specific industries, the higher costs often outweigh these benefits. In his first administration, Trump's tariffs ended up costing consumers an average of $900,000 for every steel job created.
Furthermore, workers in major apparel-producing countries like Vietnam, Bangladesh, and Cambodia are particularly vulnerable. These countries could face average tariff rates of 46 percent, 37 percent, and 49 percent respectively if the 90-day pause expires. This could lead to American retailers reducing orders or seeking alternative sources, resulting in potential factory closures, job losses, and wage pressure in these export-dependent economies.
Beyond direct employment impacts, tariffs act as a consumer tax, leading to higher prices for a wide range of imported goods, including clothing, electronics, and potentially groceries. Estimates from the Yale Budget Lab and the Center for American Progress indicate that the current tariff regime could cost the average U.S. household thousands of dollars annually, with estimates ranging from $1,200 to $5,200. This increased cost of living disproportionately affects low- and middle-income households, as tariffs are inherently regressive. The broader economic consequences of these tariffs also pose a significant threat to livelihoods. The risk of reduced GDP growth, potential recession, and increased economic uncertainty can negatively impact job security, investment opportunities, and overall economic well-being across various sectors. The potential revenue generated by these tariffs might not be sufficient to offset the widespread negative economic consequences for the average American family.
The Illusion of Environmentalism
While reduced emissions and less fast fashion waste might seem environmentally appealing, relying on tariffs as the primary means is inefficient and carries significant economic risks. A major concern is the potential for tariffs on imported components and materials to increase the cost of clean energy technologies like solar panels, wind turbines, and EV batteries, hindering the crucial transition to a low-carbon economy. Experts largely agree the long-term environmental benefits of green energy solutions would outweigh the emissions costs required to ship these materials, thereby undoing the impact of tariffs.
A more effective and sustainable approach to environmental protection involves direct and targeted policies, such as carbon pricing, stricter environmental regulations, and substantial public and private investments in renewable energy infrastructure and sustainable practices. These measures can directly address environmental challenges without the broad and often damaging economic consequences of tariffs. Furthermore, trade wars triggered by tariffs can undermine the international cooperation essential for tackling global challenges like climate change. When countries are in trade disputes, their willingness to collaborate on environmental issues, and other human health, safety, and security issues, decreases.
While the Trump tariffs might offer a temporary and unintended environmental benefit by slightly slowing GHG emissions and potentially reducing fast fashion waste, these co-benefits are significantly outweighed by the substantial co-costs imposed on labor and livelihoods. The potential for job losses, wage stagnation, increased consumer prices, and broader economic instability far overshadow any minor environmental advantages. Moreover, relying on tariffs as a primary tool for environmental protection is a crude and ultimately counterproductive strategy, especially considering the potential to hinder the transition to clean energy. These co-benefits may be a small win for those who care about the environment and climate change, but the direct impacts of these tariffs are not worth the gamble with Americans' and international health, livelihood losses, and the impending loss of American influence and trust around the world.
Longer-lasting benefits can only come from adopting targeted, direct, and internationally collaborative policies that prioritize environmental sustainability and economic well-being. It is this approach that can ensure a future where both people, in the United States and abroad, and the planet can prosper.
J. Freya H. Latwin, Ph.D., holds degrees in environmental and developmental economics from the University of Oxford and the London School of Economics and Political Science. She's lived and worked globally and holds affiliate academic positions at East Carolina University, George Mason University, and Virginia Polytechnic Institute and State University.
The views expressed in this article are the writer's own.