Listeners, the US-China trade relationship has reached a new boiling point as President Trump announced on October 10 an additional 100% tariff on all Chinese goods, set to take effect November 1. This move comes in retaliation for China’s decision to broaden export controls on rare earth minerals, of which China supplies about 70% of the world’s demand. Trump also declared that the US would impose comprehensive export controls on what he called “any and all critical software”—a striking escalation in this ongoing economic rivalry, as detailed in the latest Wikipedia briefing on tariffs in the second Trump administration.

This new round of tariffs means the effective US tariff rate on Chinese imports will soar to historic levels, following an earlier cycle this year where tariffs rose as high as 145% after a retaliatory spiral in April. In response, the Chinese Finance Ministry stated they would ignore any further American tariff hikes, declaring that such moves would “become a joke in the history of world economy.”

The real-world consequences have already started to hit American businesses and consumers. Retail CEOs warned the White House back in April that tariff escalation would lead to visible price increases and widespread product shortages. Data from the Bureau of Labor Statistics in August showed a sharp slowdown in hiring, which many attribute to tariff-induced uncertainty. Despite these concerns, President Trump dismissed the numbers as “rigged” and even fired the head of the bureau.

While tensions have grown, both the US and China have attempted negotiations. In May, officials from both countries held talks in Switzerland, and by mid-May they agreed to a temporary reduction in tariffs—down to 30% for US tariffs on Chinese goods and 10% for Chinese tariffs on American goods—for a 90-day negotiating period. Despite occasional signs of progress, according to Discovery Alert and Fortune, most current diplomatic efforts focus on restoring the pre-tariff economic environment rather than creating new trade frameworks.

By September, the average applied US tariff rate was estimated at 17.9%, but current events are pushing these rates much higher. The Trump administration’s aggressive use of tariff authorities, including moves under the rarely-invoked International Emergency Economic Powers Act, and his closure of the de minimis exemption for low-value imports are considered unprecedented in scale. As of last month, US tariff revenue soared above $30 billion per month, compared to less than $10 billion per month just a year ago.

Listeners should also note that China has retaliated by halting all rare earth exports, intensifying their licensing regime on critical minerals, and banning key business ties with US subsidiaries of Korean shipbuilders. The resulting tit-for-tat has not only raised economic and supply chain risks, but has also injected a great deal of uncertainty into global markets.

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