Trade and Tariff Policy

Axios obtained nearly 10 minutes of secret audio from two 2025 donor meetings in which Sen. Ted Cruz harshly criticizes President Trump’s tariff strategy and Vice President JD Vance, underscoring deep internal GOP rifts ahead of 2028. On the tapes, Cruz warns donors that Trump’s April 2025 tariffs could tank 401(k)s by 30%, push grocery prices up 10–20%, cost Republicans the House and Senate in 2026, and leave Trump 'being impeached every single week'—claims he says sparked a profane 'F**k you, Ted' response from the president during a late‑night call. Cruz repeatedly portrays Vance as a creation and proxy of Tucker Carlson, alleging the two pushed out then–national security adviser Mike Waltz for backing airstrikes on Iran and helped install Army veteran Daniel Davis, whom Cruz calls 'a guy who viciously hates Israel,' in a top intelligence role before he was quickly removed. The comments, far sharper than Cruz’s public posture, reveal him staking out a traditional free‑trade, hawkish foreign‑policy lane and positioning for a possible 2028 presidential primary clash with the more protectionist, less interventionist Vance wing of the party. The leak will fuel online chatter about a looming civil war inside the GOP over tariffs, Ukraine and Iran, and about how many Republicans privately fear Trump’s trade agenda could backfire economically and politically even as they stay publicly loyal.

A new analysis of President Donald Trump’s second-term economic record finds that his sweeping tariff strategy has sharply raised U.S. trade taxes and narrowed the trade deficit but has not delivered either a recession or the promised manufacturing boom. The effective average tariff rate has climbed to 11.2% from 2.5%, helping drive tariff collections to $195 billion in the fiscal year ending Sept. 30, 2025—more than double the previous year—with current rates implying potential revenue of about $247 billion in 2026. Economists cited in the piece say all the tariff uncertainty is a drag on growth, with 2025 GDP expected to come in around 2%, while manufacturing employment has actually fallen and many headline‑grabbing factory announcements are years from fruition or may never materialize. So far, higher import prices have not produced a fresh inflation spike, in part because firms stockpiled goods before levies hit and some have secured exemptions, but analysts warn the full price impact may yet filter through. At the same time, a strong stock market and still‑elevated home prices have widened an affordability gap: only 21% of 2025 homebuyers were first‑timers, the lowest share since at least 1981, setting up affordability as a central political fight heading into the rest of Trump’s term.