President Donald Trump is facing increasing pressure from congressional Republicans for carveouts to his sweeping tariffs that could send shockwaves through the U.S. economy.
Republicans urged Trump to cushion the blow to U.S. consumers with waivers on certain products, particularly those related to agriculture, after frustrated constituents confronted lawmakers. The demands come as Trump and administration officials acknowledge the likelihood of short-term economic pains, hint of a walkback after the stock market tanked, and already offered a reprieve for automakers.
Trump’s tariffs on Mexico, Canada, and China cover more than $1.3 trillion worth of goods based on 2024 import levels and are likely to raise costs for everyday goods, including groceries, gasoline, clothing, and technology, in addition to big-ticket items such as cars and homes.
“Our farmers and ranchers are concerned about having a trade deal put together,” said Sen. Mike Rounds (R-SD), whose state is agriculturally rich. “We’ve gone more than four years without a trade deal, so they’re feeling the heat right now in terms of commodity pricing.”
His fellow South Dakotan, Senate Majority Leader John Thune (R-SD), expressed optimism that the tariffs are “hopefully temporary” but stopped short of advocating waivers.
“Hopefully when it’s all said and done, this isn’t something that will create a lot of disruption to the markets in states like mine in South Dakota, where we’re very much dependent on agriculture,” Thune told reporters Tuesday.
Sen. Lindsey Graham (R-SC), a Trump confidant, described waivers as “probably a good idea.” He declined to offer specifics other than to emphasize that the president’s discretion should determine whether waivers are approved.
Trump dug in on his new tariffs Tuesday night at the first address to a joint session of Congress of his second term. He attributed high inflation to former President Joe Biden and vowed to bring down costs facing consumers while pleading for patience with short-term pain from tariffs that will eventually allow industries to “absolutely boom.”
Trump’s stated purposes of the tariffs is to promote domestic manufacturing and strong-arm foreign leaders into curtailing the flow of illegal drugs into the United States.
“Tariffs are about making America rich again and making America great again,” Trump said. “And it’s happening, and it will happen rather quickly. There will be a little disturbance, but we’re OK with that. It won’t be much. Look where Biden took us. Very low, the lowest we’ve ever been.”
Still, the latest sign that Trump and administration officials were acutely aware of the possible economic fallout came Wednesday when the White House announced a one-month delay on tariffs for automakers that comply with the U.S.-Mexico-Canada Agreement, a previous trade agreement among the three nations.
The temporary relief came at the request of Detroit’s Big 3 — General Motors, Ford, and Stellantis — according to White House press secretary Karoline Leavitt, and it caused stocks to largely rebound following steep selloffs on Tuesday in response to the tariffs.
Democrats have used the new import taxes to paint Trump as the latest driver of inflation. His tariff rates stand at 25% for Canada on nonenergy goods and 10% on energy goods, 25% for Mexico, and 20% for China.
Senate Minority Leader Chuck Schumer (D-NY) said certain tariffs would be prudent, such as against China to combat them “competing with us economically in unfair ways.” But he described them in their current form as hastily thought out.
“The administration has obviously not thought through these tariffs,” Schumer added. “They seem to be changing their plans by the hour. Even this uncertainty is extremely harmful to the economy. It makes it impossible for businesses to plan ahead. It depresses spending. It slows growth, eats away at consumer confidence.”
Louis Navellier, a growth investor who leads Navellier & Associates and has personal ties to Trump, downplayed the inflationary impact of the tariffs on China but predicted those on America’s direct neighbors to the north and south will be “more painful.”
“The anxiety over tariffs may be holding back some consumers, but I want to assure you that I do not expect most tariffs to be inflationary,” Navellier said in a note to investors. “As an example, the tariffs that have been imposed on China are expected to be suppressed by Chinese deflation as well as a weak Chinese yuan. The Canadian and Mexican tariffs of up to 25% are also kicking in and are expected to be a bit more painful.”
Defenders of Trump’s tariffs on Capitol Hill view them as largely temporary and an aggressive negotiating posture for better trade deals or other policy agreements, including on illegal immigration and smuggling drugs into the U.S.
“I don’t think he wants a long-term 25% tariff on Canada and Mexico,” Sen. Josh Hawley (R-MO) said. “That’s my sense. I think he’s trying to get something out of it. Hopefully, this can be a tool to get some true reciprocity.”
During a visit to the U.S.-Mexico border on Wednesday, Vice President JD Vance acknowledged the many requests for carveouts but said companies should do more investing in America to avoid tariff penalties.
“A number of industries have reached out to us to ask us for exceptions to the tariffs, but I think the president has been very clear here that he wants the tariffs to apply broadly,” Vance said on the Texas side of the border. “He doesn’t want to have 500 different industries getting 500 different carveouts. The way to avoid application of the tariffs is to have your factory … in the United States of America.”
Trump’s tariffs in his first term were far more measured, covering products valued at only about $380 billion in 2018 and 2019, and Biden left many in place, per the conservative Tax Foundation. Sen. Markwayne Mullin (R-OK), who served in the House at the time, opposes most waivers because he believes they create an unfair system based on personal connections to the White House.
“It became more of who you knew than what is the importance of it,” Mullin said. “I think it has to be a standard. If you’re going to put something in, it has to be in the national security interest and let the president make that decision.”
A national security exception he cited would be for energy, which he noted Trump already reduced for Canada.
WHICH ITEMS WOULD BE AFFECTED BY TRUMP’S PROPOSED TARIFFS ON CANADA AND MEXICO
The president’s tariffs may also have an unintended consequence: They may require the government to staff up to handle them at a time when the Trump administration seeks to slash the federal workforce and spending.
“If there are very wide-scale tariffs, there undoubtedly would be a need to hire more Customs people,” former Trump Commerce Secretary Wilbur Ross told the Washington Examiner in December 2024. “Because if you’re having dozens and dozens of more products, and those products have hundreds of thousands of elements to them and 40 or 50 or 100 jurisdictions from which they’re coming, you’re going to need more Customs people.”
Zach Halaschak contributed to this report.
