Trump threatens country after country with U.S. economic weapons

In only a week, the president has floated financial reprisals for Mexico, Canada, Russia, Denmark and Colombia. The hostilities could backfire.

WP 28-01-2025 

 President Donald Trump has already threatened to impose major economic penalties on at least a half-dozen countries, alarming global leaders as he uses the prospect of sanctions and tariffs to force other nations to do what he wants.

Almost every day during his first week in office, Trump promised to hammer some country with potent economic weapons, rapidly reshaping U.S. foreign policy in pursuit of goals on everything from trade to migration.

Trump’s combative approach — applied to such key trading partners as Canada and Mexico; adversaries such as Russia; and smaller economies such as Colombia and Denmark — reflects his view that the United States is being routinely “ripped off” by most other countries. But the blizzard of demands that don’t always address only trade put him on track for simultaneous confrontations around the globe, which could escalate unpredictably to the detriment of the U.S. and global economies.

On Sunday, his administration announced, then backed off, tariffs and sanctions on Colombia, citing a deal on the deportation of migrants that the South American nation had initially resisted.

Successive U.S. presidents have stepped up their use of economic power over the past several decades. The early days of Trump’s second term, however, are already signaling a new stage of that trend, as the president stunned the world by saying he would be willing to pulverize the economies of even allied countries over seemingly routine policy disagreements — or over sudden demands for their territory.

“This is an aggressive exercise of U.S. economic power in a way we have not seen in a very long time — at least not in the post-World War II era,” said John Creamer, who was a senior diplomat for more than 35 years and was a deputy assistant secretary of state.

Trump told a GOP retreat Monday that tariffs would soon be announced on steel, aluminum and copper. Speaking with reporters Monday night on Air Force One, he said he had not yet chosen a tariff rate. He said he had a number in his mind that he wasn’t yet ready to share.

“It will be enough to protect our country,” Trump said.

Trump said tariffs “could be” both a way to raise revenue and be a tool to get what he wants from other countries. He said the United States was “at our best” economically from 1870 to 1913.

During his first term, Trump also imposed or threatened to impose tariffs on many U.S. trading partners, including allies such as France and Canada, as he sought leverage in freewheeling negotiations. He also imposed punishing sanctions on such countries as Venezuela and Iran. Campaigning last year, Trump promised “universal tariffs” far beyond what he’d enacted during his first term, falsely declaring they were paid by foreign nations rather than U.S. consumers, and vowed to revive tough sanctions on Iran and other countries.

Still, the extent to which Trump has already turned to these tools of economic coercion has proved striking.

Last Monday, he threatened that 25 percent tariffs on Mexico and Canada would kick in Feb. 1 — this weekend — unless those countries act to curb migration and the fentanyl trade. On Tuesday, Trump floated 10 percent tariffs on all imports from China. On Wednesday, he said he would impose “high levels of Taxes, Tariffs, and Sanctions” against Russia unless it ended the war in Ukraine — a threat he reiterated on Fox News on Thursday.

On Friday, the Financial Times reported that Trump the previous week had threatened tariffs on Danish officials unless they were willing to cede control of Greenland. And on Sunday, Trump said he would impose tariffs and sanctions against Colombia unless it bent to his demands and accepted military flights returning undocumented migrants. That conflict appeared to abate Sunday night after Colombia agreed to his terms.

Meanwhile, Trump also issued an executive order renewing sanctions against the International Criminal Court in The Hague, after President Joe Biden had rescinded measures Trump imposed in his first term. Marco Rubio, Trump’s secretary of state, told Congress that he would ensure major sanctions are reimposed on the Iranian regime. Trump also floated tariffs of 100 percent on the “BRICS” nations (Brazil, Russia, India, China and South Africa) if they pursue alternatives to the U.S. dollar.

“The Trump administration is really eager to demonstrate the power of sanctions and tariffs as a lever to get policy outcomes, and looking for policy opportunities to deploy it,” said Ricardo Zúñiga, who served as a deputy assistant secretary in the State Department’s Bureau of Western Hemisphere Affairs during the Biden administration. “There should not be any doubt: These are not a bluff; they are very, very eager to use them as a kind of proof of concept. It’s a chance for them to test these weapons.”

Advisers said these demands reflect a cohesive approach to the tools of economic coercion. Trump and his aides think tariffs and sanctions have too frequently been used as half-measures but they could force policy changes if the United States threatens to impose them with maximum force, according to two people familiar with the matter, who spoke on the condition of anonymity to describe private conversations. The people said they think threatening maximum sanctions — but not necessarily imposing them — will also allow the U.S. dollar to maintain its status as the world’s reserve currency, which Trump and Scott Bessent, his nominee for treasury secretary, have described as a top priority.

“It doesn’t take a brain surgeon to see that Trump is redefining U.S. foreign policy. Previously, U.S. presidents used commercial tools when dealing with commercial issues. But being a supreme negotiator, I’m sure Trump asked: ‘Why aren’t we using all our tools to make sure we get our way?’” said Juan Cruz, who was a senior aide on the White House National Security Council during Trump’s first term. “We’re seeing a willingness to use full-force economic tools to get what we want done, and that’s emblematic of what we’re going to see from now on.”

Trump advisers such as billionaire Elon Musk cheered news that Colombia had backed down as evidence that Trump could bully his way into securing policy victories.

Colombia announced on Monday the takeoff of a military plane to the United States that will bring 110 Colombian deportees, after overcoming diplomatic tensions with the Donald Trump administration. (Colombian Aerospace Force/Handout/AFP/Getty Images)

“These countries cannot respond. The asymmetry of market pain, the flight of their capital to the United States — these emerging markets would just get crushed,” said John Feeley, who served as U.S. ambassador to Panama from 2015 to 2019. Feeley quoted the Athenian historian Thucydides: “The strong do what they can, and the weak suffer what they must.”

And yet this sort of pressure could still ultimately backfire in ways that expose contradictions in Trump’s policy goals.

Canada, Mexico and China are the nation’s three biggest trading partners. Those three export more than $1 trillion to the United States alone each year. Economists have warned that the imposition of tariffs will raise prices for consumers here — undermining Trump’s promise to control inflation.

Trump’s use of sanctions also has risks. Senior Treasury officials have been concerned for at least a decade that the overuse of economic sanctions could make the weapon less effective, by encouraging other nations to set up financial networks beyond U.S. detection. Sanctions and tariff threats against U.S. allies will give many countries added incentive to deepen their economic ties with adversaries such as China, leaving them less exposed to Trump’s financial retribution.

“It will accelerate efforts to build workarounds to U.S. sanctions and tariffs. You’re showing that everyone is vulnerable — not just adversaries like China and Russia — but allies like Canada, Mexico and Colombia,” said Edward Fishman, a sanctions expert who served in the Obama administration. “It will undercut the potency of U.S. economic weapons and undercut our efforts to get other countries on our side against China.”

Trump has largely threatened new tariffs and sanctions that he hasn’t imposed. But foreign policy experts point out that the threat must be executed at some point to be viewed by other nations as credible. The more countries Trump promises to punish economically, the greater likelihood of an escalation that hurts both countries.

“It’s a straightforward message. Whether the tactic will work or not, we’ll see,” said Caleb McCarry, who was a senior staffer to the Senate Foreign Relations Committee and was the State Department’s lead on Cuba policy during the George W. Bush administration. “Once you actually pull the trigger, you have to live with the consequences.”

Samantha Schmidt and Michael Birnbaum contributed to this report.