Trump injects new dose of uncertainty in tariffs as he pushes start date back to Aug. 7
But when Trump signed the order Thursday night imposing new tariffs on 68 countries and the European Union, the start date of the punishing import taxes was pushed back seven days so that the tariff schedule could be updated. The change — while potentially welcome news to countries that had not yet reached a deal with the U.S. — injected a new dose of uncertainty for consumers and businesses still wondering what's going to happen and when.
Trump has promised that his tax hikes on the nearly $3 trillion in goods imported to the United States will usher in newfound wealth, launch a cavalcade of new factory jobs, reduce the budget deficits and, simply, get other countries to treat America with more respect.
The vast tariffs risk jeopardizing America's global standing as allies feel forced into unfriendly deals. As taxes on the raw materials used by U.S. factories and basic goods, the tariffs also threaten to create new inflationary pressures and hamper economic growth — concerns the Trump White House has dismissed.
Questions swirl around the tariffs despite Trump's eagerness
As the clock ticked toward Trump's self-imposed deadline, few things seemed to be settled other than the president's determination to levy the taxes he has talked about for decades. The very legality of the tariffs remains an open question as a U.S. appeals court on Thursday heard arguments on whether Trump had exceeded his authority by declaring an 'emergency' under a 1977 law to charge the tariffs, allowing him to avoid congressional approval.
Trump was ebullient as much of the world awaited what he would do.
Others saw a policy carelessly constructed by the U.S. president, one that could impose harms gradually over time that would erode America's power and prosperity.
'The only things we'll know for sure on Friday morning are that growth-sapping U.S. import taxes will be historically high and complex, and that, because these deals are so vague and unfinished, policy uncertainty will remain very elevated,' said Scott Lincicome, a vice president of economics at the Cato Institute. 'The rest is very much TBD.'
The new tariffs build off ones announced in the spring
Trump initially imposed the Friday deadline after his previous 'Liberation Day' tariffs in April resulted in a stock market panic. His unusually high tariff rates unveiled then led to recession fears, prompting Trump to impose a 90-day negotiating period. When he was unable to create enough trade deals with other countries, he extended the timeline and sent out letters to world leaders that simply listed rates, prompting a slew of hasty agreements.
Swiss imports will now be taxed at a higher rate — 39% — than the 31% Trump threatened in April, while Liechtenstein saw its rate slashed from 37% to 15%. Countries not listed in the Thursday night order would be charged a baseline 10% tariff.
Trump negotiated trade frameworks over the past few weeks with the EU, Japan, South Korea, Indonesia and the Philippines — allowing the president to claim victories as other nations sought to limit his threat of charging even higher tariff rates. He said on Thursday there were agreements with other countries, but he declined to name them.
Thursday began with a palpable sense of tension
The EU was awaiting a written agreement on its 15% tariff deal. Switzerland and Norway were among the dozens of countries that did not know what their tariff rate would be, while Trump agreed after a Thursday morning phone call to keep Mexico's tariffs at 25% for a 90-day negotiating period.
European leaders face blowback for seeming to cave to Trump, even as they insist that this is merely the start of talks and stress the importance of maintaining America's support of Ukraine's fight against Russia. Canadian Prime Minister Mark Carney has already indicated that his country can no longer rely on the U.S. as an ally, and Trump declined to talk to him on Thursday.
India, with its 25% tariff announced Wednesday by Trump, may no longer benefit as much from efforts to pivot manufacturing out of China. While the Trump administration has sought to challenge China's manufacturing dominance, it is separately in extended trade talks with that country, which faces a 30% tariff and is charging a 10% retaliatory rate on the U.S.
Major companies came into the week warning that tariffs would begin to squeeze them financially. Ford Motor Co. said it anticipated a net $2 billion hit to earnings this year from tariffs. French skincare company Yon-Ka is warning of job freezes, scaled-back investment and rising prices.
It's unclear whether Trump's new tariffs will survive a legal challenge
Federal judges sounded skeptical Thursday about Trump's use of a 1977 law to declare the long-standing U.S. trade deficit a national emergency that justifies tariffs on almost every country on Earth.
'You're asking for an unbounded authority,' Judge Todd Hughes of the U.S. Court of Appeals for the Federal Circuit told a Justice Department lawyer representing the administration.
The judges didn't immediately rule, and the case is expected to eventually reach the Supreme Court.
The Trump White House has pointed to the increase in federal revenues as a sign that the tariffs will reduce the budget deficit, with $127 billion in customs and duties collected so far this year — about $70 billion more than last year.
New tariffs threaten to raise inflation rates
There are not yet signs that tariffs will lead to more domestic manufacturing jobs, and the U.S. economy now has 14,000 fewer manufacturing jobs than it did in April.
On Thursday, one crucial measure of inflation, known as the Personal Consumption Expenditures index, showed that prices have climbed 2.6% over the 12 months that ended in June, a sign that inflation may be accelerating as the tariffs flow through the economy.
The prospect of higher inflation from the tariffs has caused the Federal Reserve to hold off on additional cuts to its benchmark rates, a point of frustration for Trump, who on Truth Social, called Fed Chair Jerome Powell a 'TOTAL LOSER.'
But ahead of Trump's tariffs, Powell seemed to suggest that the tariffs had put the U.S. economy and much of the world into a state of unknowns.
'There are many uncertainties left to resolve,' Powell told reporters Wednesday. 'So, yes, we are learning more and more. It doesn't feel like we're very close to the end of that process. And that's not for us to judge, but it does — it feels like there's much more to come.'
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Texas' proposed congressional map dismantles districts flagged by DOJ
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In the Houston area, the 9th and the 18th districts, where no one race currently constitutes a majority of eligible voters, would be redrawn as just over half Hispanic and half Black, respectively. But as a result, the nearby 29th District — a fixture of east Houston's Latino community — would lose its Hispanic majority, becoming 43% Hispanic, 33% Black and 18% white. The 33rd District in North Texas, although entirely redrawn, would still have no single racial or ethnic group that constitutes a majority. Texas has long maintained that it drew these maps without an eye toward race. But tinkering with the lines now that these racial concerns have been raised risks triggering a Voting Rights Act complaint, legal experts said. States generally cannot redraw districts based on race without a compelling argument that it's necessary to protect voters' ability to elect their candidates of choice, said Justin Levitt, a redistricting expert at Loyola Law School. 'It sure seems like they have actually done what the DOJ, without any basis, accused them of,' Levitt said, noting that he had not done sufficient analysis to say for sure. Legal experts say the DOJ's interpretation of the law around coalition districts, and thus its legal threats to Texas, are based on faulty logic that could be backing the state into a discrimination lawsuit. 'Nothing in this decision suggests, much less holds, that the VRA prohibits the very existence of coalition districts,' Ellen Katz, a redistricting expert at the University of Michigan Law School, told the House redistricting committee at its first hearing last week. 'There are hundreds of these districts nationwide in which jurisdictions relying on traditional principles create these districts.' Coalition districts Section 2 of the Voting Rights Act of 1965 says states cannot engage in election or voting practices that dilute the electoral power of voters of color, including by packing them into a single district or diffusing them throughout multiple. For decades, courts held that states can satisfy the requirements of Section 2 by creating districts where multiple politically cohesive racial voting groups constitute a majority. Currently, Texas has nine districts where no one racial or ethnic group has a majority; in eight of them, Black, Hispanic and Asian voters combined create a majority. In 2024, the 5th U.S. Circuit Court of Appeals, which hears Texas-based cases, reversed a prior ruling and said coalitions of different racial or ethnic groups within one district cannot claim their rights have been violated under Section 2 of the Voting Rights Act. Citing this ruling, Dhillon told Texas that its coalition districts were 'nothing more than vestiges of an unconstitutionally racially based gerrymandering past, which must be abandoned, and must now be corrected by Texas.' But this reflects a misunderstanding of this case, legal experts say. Under this ruling, the Voting Rights Act can't require states to create coalition districts, but that doesn't mean coalition districts are inherently unconstitutional. 'All it says is that you don't have the affirmative obligation to purposely create [a coalition district] at the outset,' said Mark Gaber, a lawyer with the Campaign Legal Center who is representing a group of plaintiffs in an ongoing lawsuit against the current maps. 'It certainly doesn't say, go through the map and eliminate all of the ones you drew.' Texas leaders have contradicted themselves and each other on the question of whether the state has coalition districts and what should be done about them. Gov. Greg Abbott, days after receiving Dhillon's letter, included redistricting on his agenda for the Legislature's special session, citing 'constitutional concerns raised by the U.S. Department of Justice.' He later told Dallas' Fox 4 News that redistricting was necessary because of the 5th Circuit's ruling. 'We want to make sure that we have maps that don't impose coalition districts while at the very same time ensuring that we will maximize the ability of Texans to be able to vote for the candidate of their choice,' he said. At a House committee hearing Friday, GOP Rep. David Spiller of Jacksboro asked Rep. Todd Hunter, who carried the 2021 maps in the lower chamber, whether Texas currently has coalition districts. Hunter said 'the law was different then.' 'You had coalition districts being interpreted differently,' he said. 'Today, you have a 2024 5th Circuit case absolutely changing the law.' But in court, Texas has long argued it has not drawn coalition districts to address racial disparities, because it draws 'race blind' maps. Attorney General Ken Paxton doubled down on this argument in response to the Dhillon letter. 'The Texas Legislature has led the Nation in rejecting race-based decision-making in its redistricting process — it has drawn its current maps in conformance with traditional, non-racial redistricting criteria to ensure Texas continues to adopt policies that will truly Make America Great Again,' Paxton wrote. At the request of Democrats, the House and Senate redistricting committees have invited Dhillon to testify on the letter and her allegations against Texas, but neither she nor any representative from the DOJ has responded to the request. The Senate panel this week voted not to subpoena her. What happened to the Houston DOJ districts Three of the districts Dhillon cited in her letter are neighbors in the Houston area. All three would be radically redrawn by the House's proposed map. The 9th Congressional District is a multiracial district made up of 45% Black voters, 25% Hispanic voters, 18% white voters and 9% Asian voters. The district, which covers parts of southwest Houston and outlying suburbs, voted for Vice President Kamala Harris in 2024 by 44 points, and has reliably reelected Democratic Rep. Al Green since 2004. Under the House's proposed map, the 9th District has been redrawn around an entirely new part of Houston, retaining just 2% of Green's current district and scooping up conservative swaths of east Harris County. The Hispanic population would climb to just over 50% and the white population would almost double to 34%. Black voters would drop to 12% and Asian voters to 2%. In 2024, this new district would have voted for Trump by 15 points. 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Colombian ex-President Álvaro Uribe is sentenced to 12 years house arrest for bribery
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