Congress should reassert its role in trade policy after the midterms With the congressional midterm elections approaching, the overriding issue for voters is President Trump’s inability to improve their cost of living. Along with higher oil prices associated with the Iran war, Trump’s tariffs are unpopular.

The current situation is unusual in that tariffs traditionally have ranked near the bottom of U.S. voters’ policy priorities. The reason is that tariffs were low during the post-war era, and customers did not notice them. That is no longer the case.

Scott Lincicome of the Cato Institute recently highlighted the results of a Cato Institute-Morning Consults survey. The key finding was that 75 percent of the respondents said tariffs will be important to their vote in the November midterms, including 35 percent who said the issue is very important.

The survey also revealed how much at odds Trump’s views on tariffs are with the respondents: 74 percent said tariffs raised prices at the store, and 53 percent said they weakened the U.S. economy. Only 21 percent agreed with Trump’s position that foreigners primarily pay for tariffs. These results are consistent with a New York Federal Reserve study that found Trump’s tariffs contributed 2.9 percentage points to goods price inflation Yet despite this, Trump has shown no inclination to alter his stance on tariffs. He clings to the view that America’s trading partners have taken advantage of the openness of the American economy and that tariffs are necessary to reduce the U.S. trade deficit and to restore manufacturing.

However, there has been little to show for Trump’s efforts. After he imposed duties on Chinese goods of up to 50 percent in 2018-19, the U.S. current account deficit tripled to $1.2 trillion by 2024. One reason was that China rerouted exports through Mexico, Vietnam and other Southeast Asian countries, where the tariff rates on their goods were lower.

Thereafter, Trump increased duties on virtually all U.S. trade partners last year, so the impact of tariffs would not be circumvented. However, the merchandise trade deficit has increased this year after it narrowed in 2025. The trade gap in goods and services widened in August to the highest level since March 2025 when companies were racing to import goods before Trump’s tariffs took effect. So, why haven’t tariffs lowered the U.S. trade imbalance?

A working paper by the Baker Institute for Public Policy finds that U.S. trade patterns have shifted considerably because of two developments. First, higher tariffs, policy uncertainty and geopolitical risks are reducing direct dependence on China and pushing imports to Mexico, Taiwan, Vietnam, Thailand and South Korea. However, the massive infrastructure boom in the U.S. is creating a large surge in demand for imports of computing equipment, processing units and related parts.

In these circumstances, it is difficult to see how Trump’s policies will reduce the U.S. external deficit amid the artificial intelligence buildout. The reason is that the surplus of private sector savings over investment, which has been 2 to 3 percent of GDP, is likely to narrow as AI firms borrow funds. To offset this, the federal budget deficit would have to shrink, but no fiscal policy changes are in the offing.

Meanwhile, Congress is beginning to reassert its constitutional authority over trade policy. The Trade Review Act of 2025 introduced by a bipartisan group of senators including Sens. Maria Cantwell (D-Wash.) and Chuck Grassley (R-Iowa) would require the president to notify Congress within 48 hours of issuing tariffs. It also mandates that all new tariffs expire after 60 days unless explicitly approved by a joint resolution of Congress.

More recently, a group of Senate Democrats have taken the lead in reversing executive overreach on trade issues. A proposal by Sen. Ron Wyden (D-Ore.) would require congressional approval for new presidential tariffs and trade agreements while establishing a bipartisan Joint Committee on Tariffs and Trade. Other proposals call for Congress to rescind tariff increases on Canadian goods and to terminate the Trump administration’s Section 301 forced labor tariffs.

Looking ahead, the midterms could provide additional impetus for reestablishing congressional oversight on trade issues.

If Democrats gain control of Congress, they will have to decide whether to try to rescind Trump’s tariffs. In this regard, there is ample evidence that voters in the industrial swing states and those bordering Canada would like to see tariffs repealed. The Wall Street Journal reports that 58 percent of blue-collar workers in a recent survey oppose Trump’s tariffs, and the respondents favor Democrats by 12 percentage points.

The current environment, in short, is very different from that during the 2020 presidential election when Joe Biden did not want to alienate labor unions who supported Trump’s tariffs. It should also give congressional Republicans reason to consider whether they should blindly support Trump’s trade policies.

Nicholas Sargen, Ph.D., is an economic consultant and is affiliated with the Darden Business School. He has authored three books including “Investing in the Trump Era.”