Trump’s defeat is also due to his failures on tariffs

Tariffs certainly played a part in the Republicans’ catastrophic defeat, one of the most crushing in recent decades. Donald Trump had said it was the finest word in the dictionary. A year and a half on from Liberation Day – 2 April 2025, the day on which he announced his protectionist revolution to the world – that word has become one of the most hated by Americans. Tariffs, which were supposed to be the key weapon for reviving ‘Made in the USA’, punishing foreign competitors, reducing the trade deficit and raising wages, have turned into a boomerang – first economically and then politically.

The signs were clear before the votes were counted. According to a Cato Institute poll published before the vote, 75 per cent of voters considered tariffs to be an important issue in determining their voting choice. The most significant political finding is that the discontent extended beyond the divide between the two parties. According to exit polls released by NBC, 64 per cent of Americans believe that Trump’s protectionist policies have worsened the country’s economic conditions.

In short, the economy has once again presented the White House with the bill. In the same way that in 2024 it had enabled Trump to regain the presidency, by promising to restore to Americans the purchasing power eroded by inflation during Joe Biden’s Democratic administration. The most telling example is that of Michigan, a traditionally swing state, where the trade war with Canada has had the most visible consequences.  

In the Senate race, Republican candidate Mike Rogers has made a choice that would have been unthinkable just a few months ago: in an election advert, he appeared holding a bottle of Labatt, a Canadian beer, proposing to “put an immediate end to this tariff war” because “here in Michigan we know that Canada is not our enemy”. Rogers had realised that, in a state where trade with neighbouring Canada is extensive and significant, distancing himself from Trump’s aggressive trade policy towards Ottawa was necessary if he was to stand a chance of winning. But it was not enough, as Rogers was defeated by the Democrat Abdul El-Sayed.

In Maine, another state closely integrated with the Canadian economy, Republican Senator Susan Collins – who had also campaigned against Trump’s tariffs – lost her seat after 30 years. In October, at the eleventh hour, the White House had exempted certain imported goods from the 50 per cent tariffs in an attempt to help struggling Republican candidates such as Collins, but by then it was too late. The poison of the tariffs injected into the economy a year ago had already begun to take effect, hitting supply chains and consumers alike.

Beyond the local consequences, the outcome of Liberation Day has been disastrous overall. Trump had presented tariffs as the solution to rebalance the trade deficit, bring factories back to the United States and force other countries to foot the bill for access to the American market. But the results have not lived up to expectations. In September, the trade deficit reached $105 billion, the highest level since Liberation Day and significantly higher than that recorded in the final year of the Biden administration. Above all, it was not foreign exporters who paid the tariffs – as Trump’s foreign trade advisers Peter Navarro and Howard Lutnick claimed – but American importers. According to analyses by the Federal Reserve Bank of New York, 90 per cent of the burden of the tariffs has fallen on US businesses and consumers. Furthermore, the tariffs have also driven up the prices of domestic goods, partly due to the rise in import costs for producers and partly because businesses have been able to raise prices, shielded from competition by tariff barriers. Another study by the Federal Reserve shows that it was primarily low-income households who bore the cost of these policies – the very people who had voted Trump back into the White House to curb the rising cost of living and who have now turned their backs on him.

This economic and electoral disaster had been foretold by a few Republican Cassandras, such as the libertarian Rand Paul, one of the few to have openly opposed Trump’s protectionist policy. The Kentucky senator had warned the party by invoking the precedent of the Smoot-Hawley Act of 1930, the legislation through which a Republican-majority Congress drastically increased tariffs to protect American industry during the crisis of ’29. Trade retaliation by other countries helped to paralyse international trade, exacerbating the effects of the Great Depression. The Act turned into an economic – and consequently political – catastrophe. In the 1932 elections, the Democrats won a comfortable majority in both the House of Representatives and the Senate, and the two main architects of the Tariff Act, Senator Reed Smoot and Representative Willis Hawley, lost their seats: “When Smoot and Hawley introduced their tariffs in the early 1930s, we lost control of the House and the Senate for 60 years. So tariffs are not only harmful from an economic point of view, but also from a political one,” Paul warned after Liberation Day.

The defeat of 1932 contributed to a long-term cultural transformation of the Republican Party, which in the decades that followed – and right up until Trump’s arrival, particularly at the height of the Reaganite revolution – increasingly identified itself with free trade, deregulation and opposition to protectionism. The defeat in the 2026 mid-term elections could force the American right to change course once again. If the GOP does not want Rand Paul’s prophecy of 60 years of Democratic dominance in Congress to actually come true, it will soon have to remove the word ‘tariff’ from its vocabulary.