The only difference this time is that he now has a new pretext for imposing tariffs: he is fighting forced labor.
The administration is, of course, correct that too little is being done to combat forced labor. But its stated concern is merely a ploy. The new tariffs are similar to those Trump has already imposed based on trade balance data. Are we supposed to believe that the bilateral trade deficit just happens to correlate so closely with the use of forced labor?
When the Supreme Court struck down Trump’s previous tariffs, his administration imposed temporary tariffs for a period of 150 days (the courts have already ruled them unlawful, but the appeal is still pending, even though these tariffs expired at the end of July).
Now it has decided to impose new tariffs, citing the findings of an “investigation” into labor violations that other countries allegedly turn a blind eye to.
a
Is it any wonder that China—which has long been suspected of exporting goods made with forced labor—has been given a pass? China controls the supply of rare earth and critical minerals, so it can strike back at Trump at any moment it chooses. And when another country has the means and the will to fight back, Trump always gets scared (the TACO rule). This time, he didn’t even try to pick a fight with the Chinese.
Start with Himself
If Trump were truly concerned about forced labor, he would address this problem at home. America has long since become a hub for forced labor, due to a loophole in the 13th Amendment to the U.S. Constitution: “Neither slavery nor involuntary servitude, except as a punishment for a crime whereof the party shall have been duly convicted, shall exist within the United States or any place subject to their jurisdiction.”
This wording was abused in the South during the era of Jim Crow laws (where it was used to justify the existence of “chain gangs,” that is, groups of convicts chained together) and it continues to be abused across a significant portion of the United States: less than a quarter of the country’s states have banned forced labor.
The United States accounts for only 5% of the world’s population but a quarter of all prisoners worldwide. According to one of the most thorough studies of forced labor in America (authored by Michael Poiker), in 2005, nearly 1.4 million prisoners were working in the U.S., with about 600,000 of them employed in industry—equivalent to 4.2% of the total industrial workforce at that time. (Those who want to better understand the system of prisoner labor in the United States should watch Ava DuVernay’s 2016 documentary*The Thirteenth*.)
When Trump imposed tariffs on goods from the rest of the world last year without cause, he called this move “reciprocal.” But in the current context, the principle of reciprocity requires the imposition of high tariffs on products manufactured in those U.S. states where prison labor is still exploited.
“The Pearl of Hypocrisy”
It is particularly difficult to justify the new tariffs on goods from the European Union, since the EU’s 2024 law (“Corporate Sustainability Due Diligence Directive”) already prohibits the import of goods produced using forced labor, including products from subcontractors. Here’s yet another gem of hypocrisy: just recently, U.S. Secretary of Commerce Howard Lutnik stated that this EU law imposes an “unnecessary negative burden” on American companies, and therefore the U.S. is prepared to consider using “all possible trade instruments.”
The EU must expose this hypocrisy by refusing to capitulate. Reciprocal tariffs should be imposed on goods produced in those U.S. states where prison labor is most extensively used. The list of goods and companies that, according to available data, use prison labor in their supply chains is extensive. It includes leading American firms such as Burger King, Cargill, and Walmart.
If Trump’s actions prompt the EU to launch an investigation into forced labor in the U.S., it would be a great service to American workers. (Unfortunately, almost no one in the EU has said a word about this problem; all we’ve heard is a sigh of relief that Europe wasn’t hit even harder).
However, the hypocrisy doesn’t end there. To justify imposing new tariffs on Canada, Trump cited a provision of the infamous Smoot-Hawley Tariff Act of 1930, which allows the U.S. to respond to discriminatory tariffs.
But it’s worth noting here that the entire World Trade Organization system is based on the principle of non-discrimination, and Trump’s tariff policy blatantly contradicts it. In this case, Canada imposed tariffs on U.S. goods in response to Trump’s discriminatory tariffs.
Once again, Trump is violating international law in an attempt to capture a larger share of the value created by global supply chains. In the process, he is damaging the U.S. economy. Let’s not forget: tariffs are nothing more than a tax that distorts the economy, harming American consumers and the country’s competitiveness.
Trump’s tariff wars did not lead to the return of manufacturing to the country (so-called “reshoring”). On the contrary, the number of manufacturing jobs in the U.S. fell by 75,000 after his second inauguration, even though it had been growing under President Joe Biden.
Moreover, during Trump’s second term, the U.S. nominal goods trade deficit increased, reaching a record high of $1.24 trillion. This comes as no surprise to economists. Multilateral trade deficits depend not so much on tariffs as on key macroeconomic variables, including domestic national savings. And this figure is declining due to the record budget deficit under Trump.
Trump gets away with his policy of intimidation because too many people—both at home and abroad—have capitulated to him. Most companies and governments in competing countries have concluded that it is better not to argue and to maintain relations than to fight for themselves.
But Trump is no different from any other authoritarian leader: he needs to be feared. And the longer the world meekly gives him what he wants, the more devastating the catastrophe awaiting us all will be.
Joseph Stiglitz,
Nobel laureate in economics, former chief economist of the World Bank, former chair of the President’s Council of Economic Advisers, professor at Columbia University, and author of *The Road to Freedom: Economics and a Good Society” (W. W. Norton & Company, Allen Lane, 2024).
© Project Syndicate, 2026.
www.project-syndicate.org
Follow our updates
