• Trump's new tariff plans are in officially in action.
• They're more expansive than his first term, sweeping across industries and countries.
• Trump said that Americans might feel "some pain" with tariffs, but it's worth it to achieve US policy goals.

President Donald Trump's trade war has begun — and it's more expansive than his first time in the White House.

What makes Trump's current strategy unique is its scale. His first-term trade policies were more targeted than the sweeping tariffs across countries and industries this time around. Retaliation from China has been swift, with other countries promising action if Trump follows through on additional threats.

The trade tit-for-tat could spike costs for many goods people use every day, like medicine, cooking utensils, staple grocery items, automobiles, and appliances.

Business Insider examined data from the Tax Foundation and Peterson Institute for International Economics to compare in the table below trade actions taken by Trump during his first term with those in his second and corresponding retaliation.

While tariffs are common practice across countries and administrations to regulate the flow of goods and prop up local industries, Trump has a different approach. He's used them as a bargaining tool in both his first and second terms in an effort to achieve concessions from other countries toward his policy goals, such as strengthening the US-Mexico border.

"One goal isn't actually to go through with the tariffs," Mark Jones, a professor of political science at Rice University, said, "It's to change the behavior of another country."

Still, Trump has already followed through on two of his threats: sweeping tariffs on all Chinese imports and on steel and aluminum from any country. As a result, Jones said that Americans could begin seeing higher prices in as soon as six months because US businesses will have to pay a higher price, or will be unable to recreate foreign goods. For this reason, Jones said, the president's goals may be in conflict.

"On one hand, he wants to impose tariffs to protect American industry and to fight back against what he would consider to be unfair trade practices," Jones said. "On the other hand, he wants to bring down inflation in the United States. Those two policy agendas are, in some ways, mutually exclusive."

Trump's tariff playbook 2.0

Trump's first-term tariffs initially affected about $380 billion worth of imports, which is about 1.8% of America's GDP, Erica York, vice president of federal tax policy at the Tax Foundation, said.

In comparison, Trump's threatened tariffs on Canada and Mexico, and the imposed ones on China, would impact $1.4 trillion of imports, or 4.7% of GDP.

"That's before we consider the promised reciprocal tariffs," York said, referring to statements from Canada, Mexico, the European Union, and others that they would retaliate in the event of tariffs against them. Those reciprocal tariffs would hit US exports, potentially undermining the very industries the US tariffs are trying to support.

"In the face of those higher prices, businesses are likely to do some combination of passing higher costs along to final consumers and cutting back on employment and investment," she added.

Jones said that the result of quick inflation and price increases could be that Americans "feel poor. Their salaries will not be going up, but they will be paying more for the same goods that they normally buy, or they won't be able to buy them."

To be sure, most presidential administrations — regardless of party — have imposed tariffs. Beyond being a source of revenue for the government, tariffs encourage foreign producers to keep their prices low enough to compete with domestically made products.

The White House released a fact sheet on February 11 saying that Trump's tariffs will strengthen America's manufacturing and called tariffs "an effective tool for achieving economic and strategic objectives." Trump acknowledged earlier in February that Americans would feel "some pain" as a result of his tariffs, but added that the pain will be worth it if the US achieves its policy goals.

Additionally, tariffs on China from Trump's first term and kept in place by former President Joe Biden yielded some positive results, Ryan Hass, the director of the John L. Thornton China Center at Brookings, wrote in a February blog post. He said that the tariffs allowed the administration to "push back against Chinese transgressions" and strengthen American competitiveness.

Economists and policy researchers BI spoke with agree that Trump's second-term tariffs are a step up from his previous playbook. Many of the president's first-term levies were smaller, touched fewer industries, or were never enforced.

Throughout 2018 and 2019, the president placed 10% and 25% tariffs on hundreds of billions of dollars worth of Chinese products — including tech equipment and plastics. The tariff strategy resulted in a multibillion-dollar tax increase on goods and a reduction in trade between the two countries, per The Tax Foundation. China responded in 2019 by placing 10% retaliatory tariffs on $75 billion worth of US imports.

Trump also imposed and repealed metals tariffs on Canada throughout his first term, but did not apply sweeping tariffs. His last attempt to impose a tariff on aluminum was scrapped in the summer of 2020 to avoid retaliation from Canada. The White House also threatened a 5% tariff on $346.5 billion of imports from Mexico in 2019 as a means to curb immigration, but the tariffs were soon "indefinitely suspended" and never enforced.

With such broad tariffs on the table in Trump's second term, Jones said the strategy may not be worth the potential positives. He added that the president's first-term tariffs did not have tangible benefits for Americans' wallets, and the scaled-up 2025 plan could come at an undue cost for domestic businesses, consumers, and economic growth.

"There is a place for tariffs in the global economy," Jones said. "But an overreliance on tariffs simply to protect the domestic industries only ends up harming the economy."

• Trump's first day in office on January 20 included proposed tariffs on Canada and Mexico.
• Trump's tariff plans could raise the costs of some medications for Americans.
• Additionally, Trump said on the campaign trail he would impose a 60% tariff on Chinese imports.

Tariffs are already a central feature of President Donald Trump's second-term agenda — and those could have a significant impact on what Americans pay for some medications.

In his inauguration speeches and Day One executive orders, the president detailed his plans for imposing sweeping tariffs on foreign goods, including a 25% tariff on Mexico and Canada. Trump said the tariff policies could begin on February 1. It follows his tariff proposals from the campaign trail, including a 60% tariff on imports from China.

Some trade policy experts previously told Business Insider that broad tariffs on key trading partners like Mexico and Canada could increase the prices of goods imported from those countries. This could also stretch to key medical drugs like pain relievers, antibiotics, and cancer treatments, several of which are used in the US and manufactured abroad.

Countries like China, Canada, and Mexico not only make prescription and over-the-counter medicines, but they also supply drug ingredients. In many cases, foreign-manufactured medications are more affordable than those directly made in America — but prices and access could change with tariffs.

Trump has previously denied that his tariff policies will increase prices for Americans. Trump's press team did not immediately respond to a request for comment from BI.

What tariffs mean for your medicine costs

Under Trump's tariff plans, frequently used medications could become more expensive. Per the nonprofit organization KFF, importing some pharmaceutical drugs or ingredients from other countries has made some medicines more affordable in the US than if they were manufactured domestically due to lower production costs and cheaper labor.

In 2023, Mexico exported 165 of the 350 pharmaceutical products and drug ingredients designated as critical by the International Trade Administration. Although it was a small share of America's total pharmaceutical imports — about 1.5%, per the nonpartisan policy research firm Wilson Center — Mexico supplied key ingredients for medicines like pain relievers and antibiotics. Major pharmaceutical and vaccine companies like Pfizer and AstraZeneca also have operations in Mexico.

Canada, too, manufactures some generic forms of over-the-counter and prescription medications, like pain relievers. Per the Census Bureau, the US imported about $5.8 billion in pharmaceutical preparations in 2023.

Some states, like Florida, have previously proposed importing some prescriptions from Canada to increase affordability. The FDA signed off on imports from Canada to Florida on a range of drugs, including those used to treat HIV, AIDS, and diabetes, and other states are working to get approval to import drugs from Canada in bulk to lower high prices.

Trump proposed even steeper tariffs on China, which could affect drug prices. A 2023 report by the policy analysis firm Atlantic Council found that, between 2020 and 2022, US imports of Chinese pharmaceuticals grew by over $8 billion, and China remains one of America's major medical suppliers. China manufactures many healthcare products used by Americans like pain relievers, cardiovascular medicine, cancer treatments and immunosuppressives, cold and cough medicine, antibiotics, and bandages.

Tariffs and trade restrictions on foreign pharmaceuticals could also lead to higher prices and drug shortages if the US is unable to manufacture cheaper alternatives. Trump has suggested enforcing a "universal tariff" on all imported goods, which may impact other main suppliers of medicine, like Ireland, Germany, Switzerland, and India.

Details are unclear on how exactly Trump will impose these tariffs, and the legal authority he uses would likely determine how soon the US could see the prices of goods change. Still, tariffs are not the only avenue through which Americans' healthcare could be impacted. On Monday, Trump signed a range of executive orders — some related to healthcare — including plans to pursue actions that will "eliminate unnecessary administrative expenses and rent-seeking practices" that raise healthcare costs.

Are you changing how you approach healthcare costs with to the new Trump administration? If so, reach out to [email protected] and [email protected].