What is Trump’s ‘America First’ trade policy agenda?

A year into the second Trump administration, tariffs have taken center stage in U.S. economic and foreign policy. They are being applied broadly and justified on grounds well beyond traditional trade enforcement, yet they have not produced the economic disruption or retaliation many observers anticipated. However, the significance of this shift lies less in the increase in tariffs than in a broader redefinition of the role trade policy itself now plays in economic and national security strategy. Understanding this shift—and why the response has been more muted than expected—requires grappling with a broader change in how U.S. trade policy is conceptualized and conducted.

For much of the postwar period, U.S. trade policy was designed to operate largely in the background within a multilateral, rules-based trade framework. The system was designed  to reduce conflict and discourage retaliatory trade behavior while allowing market forces to play the primary role in allocating economic activity across countries. This framework did not eliminate government intervention; it was not apolitical nor was it divorced from strategic objectives. The system’s architects built in mechanisms intended to allow it to adapt over time, but this adaptive capacity proved limited in practice. Technological change, shifts in global production, and evolving geopolitical conditions placed increasing political strain on a framework that struggled to update its core rules and enforcement mechanisms.

Although the postwar trade framework has been under strain for some time, the America First Trade Policy memorandum, issued on the first day of President Trump’s second term, signaled a decisive break. It made clear that U.S. trade policy would no longer be guided by the assumptions and constraints that had defined it for generations. The discussion below traces how the America First Trade Policy agenda has taken shape thus far, organized around the memorandum’s three stated priorities. The aim here is to clarify the current approach; debate about what should follow in 2026 and beyond depends on understanding the theory of action now shaping U.S. trade policy.

Trade policy as a tool for correcting “unfair and unbalanced” trade

The first of Trump’s trade priorities—addressing what the administration characterizes as “unfair and unbalanced” trade—rests on the view that the United States has been treated unfairly by its trading partners, that U.S. trade policies have left the economy vulnerable to those practices, and that the combination of these factors has led to structural weaknesses in the U.S. economy. Observed bilateral deficits are treated as evidence of unfair practices and policy failure requiring corrective action rather than as outcomes to be assessed in a broader multilateral or macroeconomic context. Based on this perspective, a broad range of instruments—including tariffs, trade remedies, and measures related to taxation and government procurement—are treated as legitimate tools for restoring balance in trading relationships, and they are applied broadly rather than as exceptional or narrowly constrained interventions. In effect, imbalance itself is treated as evidence of unfairness rather than as a symptom requiring further explanation. This framing departs from standard economic interpretations of trade balances but is nevertheless central to how the administration has perceived the problem.

This approach is most clearly illustrated by the so-called “reciprocal tariffs” announced by the administration on “Liberation Day” in April 2025. Those measures introduced a baseline additional tariff of 10% on imports from most countries alongside higher, country-specific tariffs calibrated to U.S. bilateral goods trade balances. Importantly, these tariffs were implemented under the International Emergency Economic Powers Act (IEEPA), which grants the president broad authority to restrict economic transactions in response to declared national emergencies.  The scope of that authority is being tested in the courts.  

In negotiations with trading partners seeking relief from those duties, the United States has pressed for changes to policies it believes unfairly impeded reciprocity in market access for U.S. goods, including reductions in tariff and non-tariff barriers. In many cases, relief has also been conditioned on administratively negotiated purchase and investment commitments, treated as assurance of progress toward rebalancing in the United States’ favor. This element reflects skepticism that market adjustment alone will deliver rebalancing.

U.S. trade policy has long permitted tariff adjustments in response to unfair practices, but use of those measures was tied to the identification of specific policies and calibrated to offset their effects. Over time, there has been increasing recognition that currently available trade remedy authorities are not well-suited to the economic conditions shaping contemporary trade, particularly in dealing with non-market economies like China. In response, U.S. practice moved toward broader and more flexible use of domestic authorities for raising tariffs. Even so, those departures were generally scoped narrowly and applied selectively. America First Trade Policy represents a step-change in the governing logic of U.S. trade policy, going well beyond the pragmatic drift of the last decade. Investigations and reviews now serve mainly procedural functions, while executive determinations drive discretionary trade action, adjusted primarily through executive judgment rather than predefined legal constraints or international commitments.

Trade policy as a tool for redefining the US–China economic relationship

The second priority identified by the America First Trade Policy memorandum is redefining the U.S. economic relationship with China. The memorandum frames China as first and foremost as a commercial rival whose policies and practices have produced an unbalanced bilateral trade relationship viewed as an economic, strategic, and diplomatic disadvantage for the United States. Core features of China’s economic model, including state-directed subsidies, intellectual property theft, and related practices are seen as sources of persistent imbalance and erosion of U.S. industrial capacity. The memorandum operationalizes this framing into a series of directed reviews of the U.S.–China trade relationship, explicitly linking those reviews to the possibility of additional tariff adjustments and heightened enforcement, including to address circumvention through third countries.

Importantly, this diagnosis of China’s economic model is not unique to the America First agenda. The divergence lies less in the identification of unfair practices than in how China is framed—as a commercial rival to be bargained with rather than primarily a security threat to be insulated against.

This is distinct from a prevailing view in recent policy debates that treats economic interdependence with China itself as an inherent national security risk. Under that view, exposure arises from reliance on China via its dominance of certain nodes of global supply chains, vulnerability to surveillance and control through connected technologies, and the risk of military advantage gained through technology transfer. These concerns remain part of the administration’s China narrative, but its policy is not organized around reducing exposure through disengagement. Rather than viewing economic interdependence with China as a condition to be unwound or minimized to manage exposure, the administration leans more toward continued economic engagement as a potential source of leverage—one that can be shaped, bargained over, and adjusted in pursuit of commercial and strategic objectives. Interdependence is not a vulnerability to be unwound but a condition to be bargained over.

In practice, the administration has leaned on tariffs and related enforcement authorities as the central tools for managing the U.S.–China trade relationship. Escalating tariffs were imposed on China early in 2025 under IEEPA authority, citing fentanyl-related concerns.  The tariffs were subsequently adjusted down through a series of bilateral negotiations, accompanied by retaliatory countermeasures by China.  To date, those negotiations have been oriented less toward demanding changes to core features of China’s economic model and more toward delivering managed, discrete commercial outcomes. Although tariffs are justified publicly on economic security grounds, negotiations have focused on market access, purchase commitments, and sector-specific commercial concessions. As such, measures justified under economic or national security authorities have largely functioned as bargaining leverage to manage commercial outcomes rather than as narrowly targeted responses to the risks cited.

Trade policy as an instrument of economic security

The third priority of the America First Trade Policy memorandum is economic security, an objective that has taken on heightened prominence following recent supply-chain disruptions and episodes of protectionist trade policy and economic coercion.  Where the America First approach differs is not the emphasis placed on economic security—which is now widely shared across policy communities and governments—but in the theory of security it adopts.

As exemplified by the approach to China, rather than treating economic security as a problem of managing exposure within an otherwise market-oriented system, the administration defines security in terms of economic strength, industrial capacity, and the ability to exercise leverage. The National Security Strategy articulates this view further, framing security as flowing from national strength, with industrial capacity, technological leadership, and energy dominance treated as core sources of U.S. power.

Under the administration’s approach, trade policy is not used to fence off particular industries or sectors at the margins but to advance the accumulation of economic strength and leverage needed to shape outcomes in an increasingly contested international environment. These instruments are treated as structural measures for building and sustaining economic strength and leverage, rather than as temporary safeguards or narrowly scoped exceptions. While resilience and risk mitigation figure into this framework, they are not the central objectives.

Indeed, one revealing feature of this approach is what it leaves largely unaddressed. Despite accounting for the majority of U.S. GDP and the fastest-growing segment of global trade, services play a limited role in the administration’s trade policy. This omission appears intentional, reflecting a conception of economic strength that centers on manufacturing and gives comparatively little weight to the services sector. 

This production-centered approach is also reflected in other policies: in the broad application of Section 232 national-security tariffs across a wide range of industrial and resource-based sectors, as well as in the incorporation of investment and production commitments into bilateral agreements on trade. In each case, trade measures are used to pull production and capacity into the United States, rather than simply as a means to manage risk  by reducing economic exposure to adversaries. This reflects a conception of economic security that assumes production should occur domestically—or be brought under U.S. control. Importantly, this conception supports expansive intervention where industrial strength and technological leadership are directly advanced.  By contrast, it is more cautious about imposing restrictions on economic engagement—such as export controls or investment restrictions—where such constraints could risk undermining U.S. competitiveness.

Conclusion

Trade policy is no longer treated primarily as a mechanism for promoting efficiency within a rules-based system nor as a narrowly constrained instrument for mitigating discrete security risks. Instead, it is expected to play a central role in shaping the domestic economy and building bargaining power and leverage across commercial, strategic, and security domains. Rather than being used primarily to facilitate market-determined outcomes, trade policy measures are deployed in ways that reflect an emphasis on pulling production and capacity into the United States or under U.S. control.  Whether one views that shift as necessary, dangerous, or misguided, it represents a departure from the framework that has guided U.S. trade policy for decades.

These distinctions in governing logic and context matter because similar policy tools—tariffs, trade restrictions, investment screening, and enforcement measures—can produce very different responses from market participants and trading partners depending on the institutional and market settings in which they are applied. Understanding the shift in the role trade policy plays is thus a prerequisite for evaluating its consequences. It clarifies the stakes of current debates about trade, economic security, and national security: The question is not only how the United States should act, but what kind of economic order it ultimately seeks to sustain.