
President Trump publicly acknowledged his 157% tariff on Chinese goods is economically “not sustainable” yet refuses to reverse course, exposing the dangerous gamble at the heart of America’s escalating trade war with China.
Story Highlights
- Trump admits 157% cumulative tariff rate on China is unsustainable but won’t change it
- New 100% tariffs set to take effect November 1, 2025, on top of existing duties
- China’s rare earth export controls triggered the latest escalation
- Economists warn tariffs above 100% could “sever most flows” of trade between nations
- Both sides locked in dangerous cycle of retaliation with no resolution in sight
The Contradiction at the Center of Trump’s Trade Strategy
During a Fox Business interview on October 17, 2025, Trump made a stunning admission that cut to the heart of his China strategy. The 157% tariff rate his administration imposed was “not sustainable,” he acknowledged, yet he showed no intention of backing down from the escalating trade confrontation.
This rare moment of economic honesty from Trump reveals the precarious nature of the current trade war. Bloomberg Economics warns that tariffs exceeding 100% would effectively “sever most flows” of bilateral trade rather than simply raising costs for importers and consumers.
China’s Strategic Counterpunch Forces America’s Hand
The latest escalation traces back to early October 2025, when China tightened export controls on rare earth minerals critical to U.S. manufacturing and defense industries. These materials power everything from smartphones to military equipment, giving China significant leverage over American supply chains.
Trump’s response was swift and severe. On October 10, his administration announced an additional 100% tariff on top of existing duties, creating the unprecedented 157% cumulative rate on some Chinese goods. Treasury Secretary Bessent went further, accusing China of “financing war” through its economic measures, escalating the rhetoric alongside the tariffs.
Economic Reality Collides with Political Posturing
The numbers tell a sobering story about the sustainability Trump himself questions. American manufacturers, particularly in electronics, automotive, and machinery sectors, face sharp cost increases that threaten their competitiveness. Farmers brace for Chinese retaliatory tariffs on agricultural exports, while consumers across both nations prepare for higher prices on everyday goods.
Trade compliance analysts describe the situation as risking the complete “shutdown” of key supply chains that have developed over decades. The cumulative 157% rate represents uncharted territory in modern trade policy, potentially triggering a fundamental realignment of global commerce away from the world’s two largest economies.