• White House senior counselor for trade and manufacturing Peter Navarro said in an interview that Vietnam’s offer for 0% tariffs on U.S. imports “means nothing.” He added that getting rid of tariffs on the U.S. is just a start and shifted the emphasis to non-tariff trade barriers and other issues which would require major internal shifts in target countries.

Vietnam scrambled to offer no tax on U.S. imports after President Donald Trump hit the country with 46% tariffs, but that move wasn’t enough for Trump trade counselor Peter Navarro, who accused it of “cheating” and increased the expectations for countries targeted by new tariffs.

Navarro, Trump’s senior counselor for trade and manufacturing, said in an interview with CNBC Monday that the country’s offer “means nothing.” 

“Let’s take Vietnam. When they come to us and say ‘we’ll go to zero tariffs,’ that means nothing to us because it’s the non-tariff cheating that matters,” he said. 

Navarro said that the alleged “non-tariff cheating” he referred to included letting China route its exports through a country to avoid tariffs, stealing intellectual property, and levying a value-added tax (VAT) on products.

Later, Navarro added that among the many problems the administration sees with its trading partners are export subsidies, currency manipulation, and “phony” technical and safety barriers for U.S. agricultural products. 

“They all cheat us in a different way,” he said.

Fifty countries have already reached out to negotiate tariff agreements with the White House, Kevin Hassett, director of the National Economic Council, told Fox News Monday. And while Navarro said Trump would listen to any offers, the president has stood firm on last week’s “liberation day” tariffs so far. 

On Monday, Trump threatened China with 50% additional tariffs if it did not drop its retaliatory tariffs on U.S. imports.

While Navarro argued that the Trump administration wants to restore “fairness” to global trade, he also seemingly moved the goalposts for negotiating countries by emphasizing “non-tariff barriers” over foreign tariff policies. Eliminating many of these policies, such as VATs, would require major domestic changes in the target countries.

He called Vietnam and other countries’ offer of 0% tariffs on U.S. imports “a small first start.” 

“This zero tariff thing, it’s a misdirection,” he added.

Trump’s tariffs paired with a tax cut the administration is reportedly planning will help American workers, Navarro claimed. 

Meanwhile, the stock market has plummeted on the tariff news, losing $6.6. trillion in value last week. On Monday afternoon stocks saw some relief but were still shaken. The tech-heavy Nasdaq was up less than 1% while the benchmark S&P 500 index was down 0.2%. The Dow Jones was down 1%. 

This story was originally featured on Fortune.com

• A conservative think tank found the White House measured retail price elasticity when it should have used import price elasticity. That mistake meant the tariff outputs were about four times higher than they should have been. 

The formula the White House used to calculate its recent tariff is based on an error that roughly quadrupled the rates from what they should have been. 

Two scholars at the American Enterprise Institute (AEI), a conservative think tank, found the White House used the wrong value when assessing the rate at which prices would change as a result of tariffs. The correct version of the formula uses price changes in the cost of imports, meaning how much it costs a U.S. based company to buy a good from a foreign seller. Instead, the White House factored in the retail price change, which is what consumers pay. 

That meant the formula was off by a factor of four, because the White House valued the elasticity of import prices at 0.25 when it should have been 0.945, according to AEI. 

“It’s pretty bush league,” Stan Veuger, one of the AEI fellows, told Fortune in phone call. “For such a big policy you’d expect a much higher level of professionalism.”

Using the wrong value rendered the formula inaccurate, according to Veuger and his coauthor Kevin Corinth.

“Now, our view is that the formula the administration relied on has no foundation in either economic theory or trade law,” Corinth and Veuger wrote. “But if we are going to pretend that it is a sound basis for U.S. trade policy, we should at least be allowed to expect that the relevant White House officials do their calculations carefully.”

Another AEI economist, Derek Scissors, went even further, saying the administration hadn’t made a mistake, so much as intentionally fudged the math to get the outcome they wanted. 

“This whole thing was rigged,” Scissors said Monday on CNBC. “It was a manipulated way to get very high tariffs because President Trump wanted to announce very high tariffs.” 

In their original report Corinth and Veuger said they hoped the White House would lower its tariff rates as a result of their discovery. “Hopefully they will correct their mistake soon: the resulting trade liberalization would provide a much-needed boost to the economy and may yet help us stave off a recession,” they wrote. 

The three trading days since President Donald Trump announced the U.S.’s new tariff regime saw markets across the world tank. In the U.S., the Dow Jones, S&P 500, and NASDAQ Composite all cratered. In Asia, stocks in Japan and Hong Kong sank even further on Monday, after Trump vowed to escalate the ongoing trade war. While in Europe stocks fell roughly 4.5% on Monday, after a dismal performance last week. 

The calculations used by the White House were already somewhat controversial after it became apparent that discounted “reciprocal tariff” amounts were based on a simple formula of dividing the U.S.’s trade deficit with a foreign country by that country’s total exports to the U.S. The resulting number was then divided by two and used as the tariff rate for said country. 

Even without the error, the formula was dubious, Corinth and Stan Veuger said. The formula “does not make economic sense,” they wrote. “The trade deficit with a given country is not determined only by tariffs and non-tariff trade barriers, but also by international capital flows, supply chains, comparative advantage, geography, etc.”  

Given that the Trump administration’s tariffs were billed as reciprocal tariffs, analysts and investors had expected they would be based on a careful examination of a country’s trade and non-trade barriers with respect to American-made goods. Instead they were based on the formula, which the Washington Post reports President Donald Trump personally insisted on using.  

Trump’s personal views on tariffs were, in Veuger’s view, the principal reason for the recent tariff policy.

“What’s driving the policy, is that since the 1980s Trump has been a protectionist, and he thinks trade deficits are losses and trade surpluses are profits,” Veuger said. “He just likes tariffs. Then you can backfill them with various a little more sophisticated, intellectualized rationalizations. But that’s what it is—it’s rationalization.”

The White House said using retail prices instead of import prices was warranted because consumers make purchasing decisions based on retail rather than wholesale prices. A spokesperson added that in their view the tariff rates should actually have been larger.

Corinth and Veuger pointed to research from Harvard Business School professor Alberto Cavallo cited in the U.S. trade representative’s (USTR) memo about how the tariff formula, as evidence the calculations misinterpreted the difference between retail prices and import prices. Cavallo’s work “makes this distinction clear,” they wrote. 

Cavallo himself also addressed the fact his work was referenced in the USTR’s report. 

“It is not entirely clear how they use our findings,” Cavallo wrote on X last week. “Based on our research, the elasticity of import prices with respect to tariffs is closer to 1. If that figure were used instead of 0.25, the implied reciprocal tariffs would come out about four times smaller.”

If that version of the formula were adopted it would drastically lower the tariff rates imposed on countries. For example Cambodia’s 49% rate, would drop down to 13% and Vietnam’s would go from 46% to 12.2%. The vast majority of countries would end up being subject to the 10% tariff minimum the White House that is part of the White House’s new policy.

This story was originally featured on Fortune.com

President Donald Trump’s “Liberation Day” last week was more like a Day of Economic Infamy. With the announcement of sweeping new tariffs on friends and foes alike, he certainly made history. 

The open question: Is it all a negotiating ploy? Or does the president really want to isolate the U.S. from the rest of the world, start a trade war, and collapse relationships that have kept the world relatively peaceful since World War II? The announcement certainly accomplished one goal—making news. The executive orders imposing a 10% baseline tariff on all countries and far higher rates on major U.S. trading partners sparked a media frenzy, with commentators, economists, and historians noting parallels to the Smoot-Hawley tariffs, which are widely recognized as a contributor to the Great Depression.

Even Trump’s allies are speaking out against the tariffs. “We are in the process of destroying confidence in our country as a trading partner, as a place to do business, and as a market to invest capital,” wrote Pershing Square CEO Bill Ackman, who endorsed Trump last summer, in an X post on Sunday. Ackman proposed a 90-day timeout to “negotiate and resolve unfair asymmetric tariff deals.”

It’s no surprise that Wall Street and the markets hate these tariffs. Corporate leaders are in shock—reorganizing priorities, halting investments, freezing hiring, and beginning shutdowns, all while trying to keep stakeholders calm. Retailers are flummoxed.

On Capitol Hill, the tariffs also prompted predictable reactions. Democrats are delighted as newfound proponents of free trade. Republican politicians have discovered the joy of tariffs. Some unions are excited. Others are skeptical. Meanwhile, Americans are split and foreign leaders are horrified.

I see it from a different perspective as the head of the Consumer Technology Association, which represents some 1,300 tech companies. Last week, I spoke strongly against these tariffs. In doing so, I felt I was saying the obvious: These are massive tax hikes on Americans that will drive inflation, kill jobs, and may cause a recession. The Day of Economic Infamy marked the beginning of not only a global trade war, but the severing of our ties with longtime allies and trade partners. The markets agreed, with more than $5.6 trillion (and climbing) in lost stock market value since the announcement.

President Trump clearly has a plan, but I worry that his view of our country is stuck in the past. I keep hearing President Trump and Commerce Secretary Howard Lutnick talk about huge new American factories. But in a high-employment environment, it’s not clear that factories are where Americans aspire to work. Even if they did, Secretary Lutnick has acknowledged that highly automated factories will employ few Americans, other than those who build them and fix them.

The reality is that not everything can be made in the United States, and not everything should be. Beyond goods with national security implications like ships and planes, Americans are better served by investing in strong supply chains that bring low-cost goods from around the globe.

So, what’s the solution? One possible off-ramp—and possibly the preferred option for President Trump—is dealmaking. The Trump wish list may include lower tariffs from these countries, commitments to buy American goods, or investment in the U.S. If President Trump cuts a deal with Vietnam or another major manufacturing country, others will follow, and markets will calm. In fact, rumors abound that those deals are already made and will soon be announced. This is a best-case scenario, pushing the world to lower or even zero tariffs.

Another option is action from Congress, which granted President Trump tariff authority and can take it back. Policymakers are already hearing from unhappy constituents. If they face the prospect of a blue wave in the 2026 midterms, they may decide that risk outweighs the president’s wrath.

We are already starting to see some Republican rebellion. Last Wednesday, a bipartisan group of senators passed a resolution refuting the “economic emergency” justifying tariffs on Canada. Senators Chuck Grassley and Maria Cantwell have also proposed giving Congress the right to reverse new tariffs. Every few hours we hear another Republican politician publicly questioning the wisdom of President Trump’s approach to tariffs. If the markets continue their nosedive, more leaders will speak up.

Of course, President Trump is a master of rhetoric. If he sees the economy go south and public anger rise, he may attempt to turn around public sentiment by doubling down on claims that tariff revenue is needed to fund economy-boosting tax cuts. While changes to tax law require action from Congress, new framing could help bolster political support.

A final option is litigation. A plain reading of the statute President Trump used to apply these tariffs makes it clear that it was written for genuine emergencies, and these tariff actions stretch that term well beyond any rational meaning. By the time you read this, lawsuits will likely have been filed in federal courts seeking tariff injunctions. However, judges rule slowly, appeals take time, and the judicial approach is fraught with risk, tardiness, and a certain randomness.

If President Trump and our political leadership refuse these off-ramps, the result will be a trade war that wreaks economic havoc on the world. Let’s hope at least some of our leaders are focused on helping Americans truly get “liberated.”

The opinions expressed in Fortune.com commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune.

Read more:

• Exclusive: U.S. Chamber of Commerce is considering suing the Trump administration to halt global tariff assault
• The biggest names in business and finance from Bill Ackman to Howard Marks are speaking out about tariffs—Here’s what they’re saying
• Jamie Dimon concerned Trump tariffs will leave the U.S. out in the cold: ‘America First is fine, as long as it doesn’t end up being America alone’

This story was originally featured on Fortune.com