If anybody held fantasies of President Donald J. Trump luxuriantly occupying the White House as a lame duck president in his second term, in short order they've been proven wrong.
An example was never more evident, than on "Liberation Day," when our nation's 47th commander in chief unveiled a sweeping Tariff plan, covering some USD 3 trillion of imports.
President Trump acknowledges the possible disruptive nature of his plan and accepts possible near-term costs.
Given that he's been steadfast and consistent over many decades in his conviction in using tariffs as a strategic — not just tactical — tool of geopolitics, it's imperative that we look at it with a long-term view.
Let's begin with some facts, not hysteria.
First, manufacturing jobs are the bread and butter of a thriving economy.
By manufacturing, I'm talking about "MICD," short for manufacturing, industrial, construction, and defense.
They make a Main Street filled with dignity, and vibrance that cascades to the bigger economy with pubs and pizza restaurants, auto dealerships, hair-salons, grocery stores, churches, schools, libraries, and functioning civic institutions.
Workers in MICD today are skilled in the use of computer-aided tools and clean rooms; smokestacks have carbon capture mechanisms built-in. Even unions have read the writing on the wall, and are cooperating with a plan for its revitalization.
Second, the "Liberation Day" caught an appreciable many by complete surprise, and not just outside of the United States. Federal Reserve Chairman Jerome Powell was explicit in admitting that and the surprise was reflected in the equities markets' reaction to the news.
Perhaps they expected "Liberation Day" to show a tease, and not teeth.
Whatever their thinking was before these announcements, companies with intricate global supply chain connections were caught napping at the wheel.
Third, cries of betrayal and economic "self-harm" may have some truth in it.
In the near-term there is a danger of high inflation and an elevated risk of recession going into 2026 if current Tariff proposals remain in force as-is.
In asking foreign countries to pay for the privilege of access to the U.S. market, Trump is upending eight decades of U.S.-led economic order.
A favorable outcome to his long-dated program depends, critically, on quite a few factors beyond tariffs. In my last piece, published before "Liberation Day," I proposed a reincarnation of "Series X Bonds," a reincarnation of World War II War Bonds.
Those financial instruments achieved similar miracles during that time (c. 1941-1945).
Fourth, the global economy was not a shining model of free trade for much of history.
Until the fall of the Iron Curtain, the world was siloed into three buckets. if you will: the U.S. and her allies, countries behind the Berlin Wall and the Iron Curtain, and countries in-between.
Behind the Iron Curtain, and in much of the grey area in between, much of exchange of goods and services was done as a favor.
What we know today as "free trade" actually began to take shape only recently.
Fifth, corporations may have started exporting U.S. manufacturing jobs overseas a long time ago but the trend accelerated with the signing of NAFTA in 1992 and the formation of the World Trade Organization (WTO) in 1995.
Emergence of China at the expense of the U.S. bears a reminder.
In 1996 a younger Rep. Nancy Pelosi, D-Calif., took the podium at the U.S. House of Representatives and railed against "repression" of the "job-loser" U.S.-China trade relationship, one which may have "employed" "slave labor" at the other end.
Whatever Pelosi said in 1996 has amplified at least 10 times since then.
Despite all these, China was welcomed into the WTO in 2001, when noticeable section of the U.S. heartland and hinterland have already been looking hollowed out.
Since that time, China has amassed a treasure chest of U.S. debt and uses treasury holdings to grease a lopsided balance of trade regime, keeping U.S. consumers and markets hooked.
To be clear, China did not force us to export our jobs, leaders at U.S. corporations with a lopsided view of economic realities did in their own greed, and the U.S. put up no roadblocks.
China leveraged every single tool it afforded, just as any country would do when their leaders prioritize self-interest.
A possible future might look like what India is working on.
India faces 27% tariff, but she is not talking about retaliation.
Prior to "Liberation Day" India lowered tariffs covering 55% of American exports.
She scrapped a 6% tax on digital advertisements, which may have prompted Starlink to bring satellite-telephony to the country last month.
India had started bilateral talks in anticipation of tariff announcements and reached "an understanding" to double bilateral trades in five years.
India self-selected to maintain favorable terms with the U.S. because our geopolitical interests align, and she will use mercantile interests to facilitate.
Bravo!
I will be very surprised if more countries are not already having back-channel conversions before going public.
Even at its best, tariffs are not a panacea by themselves, we will need more tools to make American manufacturing humming again.
If there is an endgame, it will be a much happier place, a nirvana of sorts — we will have our towns thriving, we will know who our friends are outside the country, and we will prioritize the common man and the common woman like what we should have always done.
President Trump is a showman, and I would not be surprised if he views "Liberation Day" executive orders to be as impactful as Abraham Lincoln's Emancipation Proclamation of Jan. 1, 1863.
If "Liberation Day" brings a fraction of the positive change as he predicts, he will be forgiven for the brag.
Partha Chakraborty, Ph.D., CFA is an economist, a statistician, and a financial analyst by training. Currently he's an entrepreneur in water technologies, blockchain and wealth management in the U.S. and India. Dr. Chakraborty resides in Southern California.
© 2025 Newsmax. All rights reserved.