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APRIL 10, 2025 |
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Harvard Kennedy School | | | |
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New electric cars for sale are seen parked at a distribution center of the Changan automobile company in southwestern China's Chongqing municipality on March 24, 2024. (Photo: AFP/China OUT/Getty Images) | | |
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Public Finance |
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How do tariffs work and how will they affect the global economy? |
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President Donald Trump recently announced and then postponed a new tariff regime that is more severe than anything seen in more than a century and that runs counter to the United States’ customary role as the creator and guarantor of an international system of free trade. Trump has claimed tariffs will have multiple benefits for America—including increased government revenue, a lower trade deficit, and growth in domestic manufacturing—but Harvard Kennedy School Professor Robert Lawrence, an expert on international trade, says things may not work out that way. On manufacturing, for example, Lawrence says even if the trade deficit in goods was entirely closed, the percentage of Americans employed in manufacturing would only rise from 8% to 10%—an amount “simply too small to have a significant impact.” He also says the risks of a tariff war include global recessions and U.S. economic isolation. “The old debate was, do we decouple the West from China?” he says. “The new debate is going to be, well, does the rest of the world really need the United States?
Learn more about Public Finance at HKS » | | |
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International Relations & Security |
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Ambassador Wendy Sherman on America’s geopolitical realignments under Trump |
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Even as President Trump's tariffs are creating worldwide economic turmoil, his geopolitical realignments have sown confusion and consternation with traditional U.S. allies, including Canada and the European Union. While many observers see more randomness than method to Trump’s radical foreign policy shifts, former Deputy Secretary of State Wendy Sherman—a seasoned diplomat who played a key role in brokering the 2015 Iran nuclear deal—warns that there may be a disturbing authoritarian through-line connecting Trump’s domestic, economic, and geopolitical agendas. Ambassador Sherman, who’s back at HKS as a Belfer Center senior fellow and a Hauser Leadership Fellow at the Center for Public Leadership, discussed Trump’s actions on a recent episode of HKS PolicyCast.
Also listen: Professor Joseph Nye joins PolicyCast to discuss U.S. global soft power and how it is entering a new period of decline under Trump.
Learn more about International Relations & Security at HKS » | | |
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Environment & Energy |
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HKS Professor Joe Aldy on the future of renewable power under Trump |
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HKS Professor of the Practice of Environmental Policy Joe Aldy says the differences between the second Trump administration and the Biden administration on support for the clean energy transition will be particularly dramatic—including major shifts in areas such as fossil fuel production, electric vehicle subsidies, and climate change mitigation. In a new Q&A, Aldy says he was surprised that President Trump, on his first day in office, signed an executive order declaring a national energy emergency and calling on agencies to try to find new ways to quickly invest in U.S. fossil fuels production—given there has been already significant domestic growth and investment across all different kinds of energy. “We’re really in a period of true abundance of energy,” Aldy says. He also says any move to promote fossil fuels over renewables at the federal level will face headwinds because “one thing we learned from the first Trump administration is that as the federal government sort of slows down and even tries to move backwards on climate, a lot of states move forward.”
Learn more about Environment & Energy at HKS » | | |
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International Relations & Security |
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Former U.S. ambassador to China Nick Burns discusses the “difficult and competitive” relationship between the two countries |
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On his first day back at Harvard Kennedy School after four years as U.S. ambassador to China, Nicholas Burns shared his experiences—and his advice—at the John F. Kennedy Jr. Forum. Burns called the U.S. relationship China “very difficult” and “competitive,” and said there were times he worried that, without adequate trust or communications at a senior level, the United States wouldn’t be able to handle a crisis related to China. Following a high-level U.S. visit to Taiwan that infuriated Beijing, it took until late 2023 for the U.S.-China relationship to stabilize, Burns said. He also called the release, in November 2024, of four Americans held unjustly in Chinese prisons "the best day" of his ambassadorship. Burns, who in addition to resuming his professorship at HKS is also a faculty affiliate at the Fairbank Center for Chinese Studies, also discussed President Trump’s tariff push and rapidly changing U.S. relations with its traditional allies.
Also read: Harvard Gazette interview with Nicholas Burns.
Learn more about International Relations & Security at HKS » | | |
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