Trump Promises New Tariffs on Chips, Copper, Drugs, Steel, Aluminum

Trump, who spoke to House Republicans at his resort in Florida the evening of Jan. 27, also reiterated his love for tariffs, and quoted President William McKinley at length on that president's philosophy on tariffs.

"In particular, in the very near future, we’re going to be placing tariffs on foreign production of computer chips, semiconductors, and pharmaceuticals to return production of these essential goods to the United States of America," he said.

He criticized the CHIPS Act as "ridiculous," and characterized it as a Joe Biden initiative, though it was passed by a bipartisan group of senators. He complained that Taiwan makes 98% of chips (it doesn't, though it makes the lion's share of advanced chips), and said that chipmakers don't need grants or loans to build fabricating plants in the U.S., "the incentive is going to be they’re not going to want to pay 25, 50 or 100% tax."

"I’ll also be placing tariffs on steel, aluminum and copper and things that we need for our military," he said, and also suggested he'd use trade policy to bring back domestic commercial shipbuilding. The Office of the U.S. Trade Representative recently published a report saying that China's support for shipbuilding burdens the commerce of the U.S., but leaving the remedy to the next administration to decide.

Trump didn't talk about the 25% tariffs on Mexico and Canada he previously said might start four days from now, but complained about Mexican and Canadian auto exports to the U.S.

"The autoworkers voted for me, and I have an obligation to do what’s right," he said. He told an anecdote he has told before, about a planned Chinese-owned auto factory in Mexico, and he said the company backed away from the project because of the possibility Trump might win and put heavy tariffs on the cars made there.

"Mexico’s taken 32% of our [auto] business over 30 years," he said. "The other one is Canada. They send us millions of cars," he said, and complained that the U.S. doesn't need cars from Canada. "We want the cars made in Detroit or South Carolina, or many other locations."

According to a study by the International Trade Commission, about 69% of new light vehicle production in North America was located in the United States in 2022, 23% was located in Mexico, and the rest in Canada. According to Canadian automakers, only 1.5 million cars were made in Canada in 2023; about 8% were for the domestic market, and 1.3 million were exported to the U.S.

Trump also bragged about the Section 232 tariffs he imposed on steel. "If I didn’t put on the massive steel tariffs, you wouldn’t have one steel plant right now in the United States," he said. He also took credit for safeguard tariffs on washers, which he erroneously said also applied to dryers. "If I didn’t put tariffs on washing machines, dryers and the like, you would have lost all of those companies that made washing machines and dryers. They were going to close up their factories, because South Korea was dumping washing machines, and we put a 50% tariff, 75%, even 100%, and now they’re thriving."

The tariff on washing machines was actually 20% within the tariff rate quota, and 50% past the quota, and declined each year.

Trump quoted McKinley: "The protective system invokes the highest law of nature … that is self-preservation. The American producer should in every way be favored against a foreign producer whose products compete with his. This is our natural market, we have made it, we have made it at an enormous cost, capital and exertion...."

Trump agreed with McKinley's assertion that if foreign factories want to sell into the U.S., they must pay for the privilege of doing so.

"Taking our jobs, taking our product, destroying our country," he said. "The North Carolina, the furniture business, what they’ve done to these great artisans -- that whole thing was wiped out by China, mostly, but others [too] ... but it’s going to come back, it’s going to come roaring back, it’s all going to come roaring back."

"Under the America First economic model, as tariffs on other countries go up, taxes on American workers and businesses will come down, and massive numbers of jobs and factories will come home," he promised.

He told the lawmakers they "got a little indication" of how he's going to protect the country with tariffs with his threats against Colombia, and their decision to accept flights of their deported citizens.