Trump Must Secure Trade Agreements and Implement Tax Cuts to Mitigate Economic Strain

It’s evident that President Donald Trump’s tariff strategy has led many countries to initiate negotiations; his team must act quickly to secure these deals and prevent a political and economic downturn.

If the Trump administration drags out discussions, the repercussions of inaction will be far more severe than accepting trade agreements that might not be ideal.

Keep in mind, the leaders of these countries will need to advocate for the agreements with their populations and legislative bodies. Anything excessively burdensome could backfire, necessitating a return to the negotiation table and extending economic instability.

In contrast, prompt trade agreements could reduce tariffs and other barriers on U.S. exports, enhancing a critical segment of the economy and alleviating market fears that Trump is intent on sparking a global trade conflict.

If the suffering continues for too long, the political repercussions could create divisions among Republicans in Congress, potentially allowing Democrats to disrupt the “big, beautiful” tax bill along with other aspects of Trump’s agenda.

As it stands, gross domestic product dipped slightly (when adjusted for inflation) in the first quarter, showing an annualized decline of 0.3%.

Tariff-related issues—coupled with the tax bill’s unlikely passage before July—could lead to a second quarter of contraction, resulting in bleak economic sentiment that may become self-fulfilling or trigger political unrest.

Cancellation of shipments from overseas (with volume dropping by as much as 50% for Chinese products) is already igniting concerns over supply shortages, empty shelves, and a possible recession by summer.

Swift trade agreements could ensure that these shortages are brief, enabling other positive factors (like the impressive private-sector job growth in April) to take center stage in expectations.

Commerce Secretary Howard Lutnick mentions that Team Trump has agreed on an initial deal, though he did not specify the country and details were still being finalized last week.

This agreement needs to be concluded as soon as possible—followed by additional deals—to regain the momentum required for swiftly passing the tax-cut bill in Congress.

If the bill fails, the country faces a return to the pre-2017 tax rates, virtually ensuring a recession, a midterm electoral setback for the GOP, and potential stagnation (at best) in Washington.

And you might as well forget about that golden age.