Trump's Commerce Secretary Nominee Advocates for Comprehensive Tariffs
Howard Lutnick, President Donald Trump's nominee for Commerce Secretary, emphasized the potential benefits of implementing broad country-by-country tariffs. During his confirmation hearing, Lutnick expressed his preference for "across the board" tariffs, arguing that they could address various economic concerns, including protecting America's leadership in artificial intelligence (AI).
Lutnick also linked tariffs to ongoing debates on AI export controls, which he would oversee if confirmed. He suggested that export controls alone could lead to an ineffectual "whack-a-mole model" without the support of tariffs. Some observers have criticized the Biden administration's export controls as insufficient to prevent Chinese AI startups like DeepSeek from developing advanced models. "They stole things, they broke things, they have taken our IP," Lutnick said of China. "It's got to end."
Lutnick's strong advocacy for tariffs comes ahead of a crucial February 1 deadline, by which Trump's initial tariffs could be imposed. Trump has referred to Lutnick as the official who will "lead our Tariff and Trade agenda."
Lutnick opposed targeted duties, arguing that they could lead to counterproductive tit-for-tat measures. He also expressed skepticism about tariff exclusions, aligning with Trump's view of broad, "macro" actions. Lutnick acknowledged that tariffs could result in price increases for certain goods but dismissed the notion that they cause inflation, calling such claims "nonsense."
Lutnick's confirmation is considered likely as he has received support during the hearings. Senator Brian Schatz of Hawaii described the session as a "bit of a love-fest." Lutnick's portfolio as Commerce Secretary would include a wide range of responsibilities, including overseeing the Biden-era Chips and Science Act, which aims to boost semiconductor production in the U.S. While Lutnick supported the program as a "down payment" in this effort, he aligned with Trump's criticism of its reliance on funding, advocating instead for tariff-based incentives.
Lutnick's statements reflect a hawkish stance on tariffs within Trump's orbit, despite more moderate proposals from other administration officials. Treasury Secretary Scott Bessent has reportedly floated a plan for gradually increasing tariffs, but Trump has voiced opposition, favoring a maximalist approach.Lutnick emphasized the role of tariffs in creating reciprocity and pledged to counter any retaliation. While historically, such measures have impacted farmers, he argued that new duties would ultimately benefit the agricultural sector.
Markets and global leaders are closely monitoring the situation ahead of the February 1 deadline. Mexican President Claudia Sheinbaum expressed skepticism about the implementation of 25% tariffs on Mexico, stating that the country has a plan in place. Trump and his aides, however, have maintained that the deadline remains in effect. Lutnick acknowledged the possibility of Trump backing down, referring to this week's potential tariffs as separate from the administration's overall long-term plans. He emphasized the need for Mexico and other countries to address migration and illegal drugs to avoid tariffs.