For anyone with an interest in trade policy, the last decade represents a fascinating experiment. Its central question: What happens when the world’s most powerful economy reverses course on international integration?
Coming out of a thirty-year stretch in which Washington had championed free trade, strengthened global trade rules, and helped create international bodies like the World Trade Organization (WTO), Donald Trump’s first presidency marked a sharp break with that approach. Three decisions in particular underscored the shift: the withdrawal from the Trans-Pacific Partnership (TPP), the blocking of appointments to the WTO’s appellate body, and the unilateral imposition of new tariffs on US trading partners.
While other Western economies—including Canada, the United Kingdom (UK), and the European Union (EU)—have remained committed to multilateralism, the United States has increasingly embraced protectionism and economic nationalism.
The experiment is still ongoing. But ten years in, its first results are beginning to emerge.
What’s the toll of tariffs and trade wars?
Three findings stand out.
First, the results so far challenge the “bicycle theory” of trade policy. In 2001, Robert Zoellick, the US Trade Representative under President George W. Bush, warned that “If the trade liberalization process does not move forward, it will, like a bicycle, be pulled down by the political gravity of special interests.” This view was widespread throughout much of the WTO era.
Yet data from the past decade have not borne that out. Despite Washington’s turn toward economic nationalism, global trade has continued to flourish. In fact, trade as a percentage of global GDP rose from 54 percent in 2016 to 68 percent in 2025. This seems to suggest that “the political gravity of special interests” has not been strong enough to pull down the broader forces driving international trade.
Second, the experiment has also failed to deliver the economic calamity long associated with protectionist trade policy. Ever since Vice President Al Gore invoked the alleged harm resulting from the Smoot-Hawley Tariff Act of 1930 in a debate over the North American Free Trade Agreement, dramatic claims about the harmful effects of tariffs have been a regular feature of US debates over trade policy. But the Trump administration’s trade measures have not produced a new Great Depression.
In 2016, real median household income in the United States—measured in 2025 US dollars—was $77,230. By 2025, it had increased to $87,460. Meanwhile, the S&P 500 more than tripled from 2,271.31 on January 20, 2017, the day Trump was inaugurated for his first term—to 7,718.60 by September 4, 2026.
Third, the United States has not only avoided the economic collapse predicted by critics of protectionism but has also outperformed other major economies. The chart below shows GDP per capita in constant 2015 US dollars for each of the G7 countries. Between 2016 and 2025, US GDP per capita grew 18.3 percent—the fastest rate among the group.
And the US advantage extends into overall economic output, as a comparison of GDP, in trillions of current US dollars, for the EU-27 and the United States in 2016 and 2025 shows:
In 2016, the EU-27’s GDP was equivalent to 74.4 percent of the US economy. By 2025, that figure had fallen to 69 percent. In other words, the United States pulled further ahead.
And there isn’t any reason to believe that this trend will reverse anytime soon, as the International Monetary Fund’s (IMF’s) growth projections for each G7 country in 2026 and 2027—measured by annual percentage changes in real GDP—show:
In short, the IMF projects that the United States will have the fastest-growing economy in the G7 in both 2026 and 2027.
Of course, none of these facts has resolved the ongoing debate over US trade policy. Economic performance alone cannot settle a discussion that is ultimately shaped by competing views about the proper role of markets, national sovereignty, and international institutions. For example, if someone believes that it’s immoral to prevent a transaction between a willing buyer and a willing seller, no amount of data is likely to change their mind. Similarly, if one had high hopes that the WTO represented the beginning of a new global political system in which national sovereigns would cede power to international bureaucracies, strong US economic growth is unlikely to alter that conviction.
But the data matter nonetheless, as they will undoubtedly inform how the Trump administration interprets the results of its trade experiment. At this point, the evidence is likely to reinforce Washington’s view that its policies are succeeding and that critics have dramatically overestimated the risks of a more nationalist trade policy. And if the United States continues to outperform other Western countries, those countries could face growing pressure to reconsider their own trade strategies.
In this vein, former US Trade Representative Michael Froman recently observed that “The EU has long been more ideologically committed than the United States to multilateralism and free trade, at least rhetorically, as a key element of its project of integration.” Yet “after years of trying to triangulate between the United States and China, it is belatedly and reluctantly following Washington’s lead in erecting trade barriers to Chinese exports.”
Finally, as US policymakers grow more comfortable with the idea that trade policy—much like tax policy—can be made on a national basis, the debate over trade may shift from philosophical questions about what can be done to practical questions about what should be done. The United States has changed course on trade policy repeatedly over the past two and a half centuries. That pattern may be returning. Almost ten years after launching its trade policy experiment, the Trump administration has reason to believe that its approach may prove durable, while other countries will increasingly have to decide whether to follow its example. And everyone seeking to understand Washington’s approach will need to grapple with these facts.
Stephen Vaughn is a nonresident senior fellow with the Atlantic Council’s GeoEconomics Center.
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Image: President Donald Trump holds a press briefing on the US Supreme Court decision to block the use of IEEPA tariffs. Source: REUTERS/Yuri Gripas/POOL via CNP/INSTARimages.com.
