Howard Lutnick defends Trump’s global import tariffs to close trade loopholes

Commerce Secretary explains why even uninhabited territories face U.S. tariffs.

US President Donald Trump holds a chart while delivering remarks on reciprocal tariffs alongside US Secretary of Commerce Howard Lutnick during a "Make America Wealthy Again" event in the Rose Garden at the White House in Washington, DC, on April 2, 2025. Photo by Brendan Smialowski/AFP

By Anna Fadiah and Hayu Andini

In a recent interview, U.S. Commerce Secretary Howard Lutnick defended President Donald Trump's sweeping global import tariffs, saying the policy is designed to eliminate every possible trade loophole. Speaking on CBS News' Face the Nation, Lutnick explained why the tariffs apply to nearly all countries and territories in the world — including the uninhabited Heard and McDonald Islands.

Trump’s global import tariffs has resurfaced in political and economic discussions as the administration takes a hardline stance on trade. Lutnick made it clear that the policy wasn’t about punishing irrelevant territories, but about eliminating every possible route foreign powers — especially China — might exploit to gain access to U.S. markets through third-party countries.

Why tax a land of penguins?

Host Margaret Brennan posed a pointed question that captured the absurdity many Americans might feel about the policy. She asked why Trump’s global import tariffs included remote, uninhabited places like the Heard and McDonald Islands — a barren Australian territory that exports nothing to the U.S. and is home only to penguins. Lutnick’s response? It’s not about the islands themselves, but about the possibility of them being used as loopholes.

"The whole point is to make sure no country is left behind," Lutnick explained. "If any country is left off the list, countries seeking to arbitrage the U.S. will trade through these countries."

In other words, even a lifeless rock in the ocean could become a trade gateway if it's not officially taxed. For Lutnick and Trump, the devil is in the details — or in this case, the loopholes.

Closing loopholes to stop trade arbitrage

The rationale is strategic. According to Lutnick, Trump’s global import tariffs are designed to close every backdoor foreign manufacturers might use to dodge direct trade restrictions. He cited China's response to previous tariff waves, particularly those launched during Trump's first term in 2018.

"China didn’t stop exporting. They just built through other countries," he said. "President Trump knows this. He's tired of it and he's going to fix it."

This means targeting even the most obscure nations and territories that might be used as intermediaries for goods that would otherwise be subject to steep tariffs. According to Lutnick, it’s not about who is doing the exporting — it’s about how the system can be exploited.

Trump’s approach may seem extreme, but the Commerce Secretary insisted it’s necessary for long-term trade security.

AI and tariffs: A new frontier?

Brennan also asked whether artificial intelligence played a role in determining which places should be included in the tariff program. While Lutnick didn’t directly confirm or deny AI involvement, he made it clear that the strategy is built on past experience, not speculation.

“This isn’t about guessing. It’s about history. China has shown us how this works, and we’re not going to let it happen again,” Lutnick said.

The implication is that data — whether analyzed by AI or not — shows a clear trend of trade diversion. To prevent it, the U.S. is going full throttle with its tariff list, leaving no stone, or island, unturned.

National security and economic survival

But there's more to Trump’s global import tariffs than dollars and cents. Lutnick stressed that the president sees trade imbalances and foreign dependency as threats to national security.

"We need to make drugs. We need to make semiconductors. We need to build ships. We need iron and aluminum," Lutnick said. “Rebuilding American industry isn’t just about jobs — it’s about survival.”

This echoes Trump’s broader message: that the U.S. must reclaim its industrial base to defend its sovereignty. For Lutnick, that’s not political rhetoric — it’s a mission.

He added that America’s vulnerabilities were laid bare during the COVID-19 pandemic, when shortages in everything from medical supplies to computer chips showed how dangerously dependent the U.S. had become on global supply chains.

“We can’t let that happen again,” Lutnick said. “We’re going to be self-reliant.”

Critics push back

Of course, not everyone is convinced. Critics argue that applying tariffs to virtually every country — even to places without exports — is an overreach that risks isolating the U.S. economically. Some fear retaliatory measures, while others warn that higher costs for imported goods could hurt American consumers.

There are also questions about feasibility. Can the U.S. really monitor trade activity through obscure territories? Is it realistic to treat every corner of the globe as a potential threat?

Despite these concerns, the message from Lutnick and the Trump camp is unwavering: this is a necessary move to protect the U.S. economy from exploitation. Whether or not voters and lawmakers agree remains to be seen.

A zero-tolerance approach to trade

Trump’s trade strategy has always been rooted in hardline nationalism. Now, with global tensions rising and economic competition fiercer than ever, Trump’s global import tariffs are being expanded — and defended — in ways that even surprise longtime observers.

What once seemed like symbolic gestures against countries like China have evolved into a comprehensive global net. Every nation and territory, no matter how small or irrelevant they might seem, is being evaluated as a potential conduit for unfair trade.

In Lutnick’s view, it’s about ensuring that American workers and industries are protected — not just from obvious threats, but from the subtle manipulations of an interconnected world.

“Trump couldn’t allow any part of the world to be a place where China or other countries could ship their products through,” he said. “So he decided to eliminate ridiculous loopholes.”

What’s next for U.S. trade policy?

Looking ahead, it’s likely that the global tariff regime will continue to expand and evolve. While the Biden administration has largely upheld Trump’s policies in this area, a possible Trump return to office would almost certainly accelerate the zero-tolerance approach.

Analysts expect further clarification on how territories are evaluated and how enforcement will work. For now, one thing is clear: Trump’s global import tariffs aren’t going anywhere — and they’re reshaping how America approaches international trade.

Whether this new era of tariff enforcement will bring the promised results is still an open question. But with leaders like Lutnick doubling down on the strategy, the U.S. appears committed to closing every loophole — even if it means taxing the penguins.