Peter Navarro: The Economist Behind Trump’s Tariff Policies

Translated and Edited by Cheryl L.

Global financial markets are reeling from the shockwaves of Trump’s newly announced “reciprocal tariffs” policy, which imposes aggressive trade measures on virtually all U.S. trading partners.

On April 7, as of 10 PM Eastern Time, U.S. markets saw sharp declines: the S&P 500 futures dropped 5.98%, Nasdaq 100 futures fell 6.2%, and Dow Jones futures slid 5.5%. Asian markets mirrored the panic, with Japan’s Nikkei plunging 8.9% during early trading hours and Taiwan’s Weighted Index tumbling nearly 10% after a two-day holiday, triggering circuit breakers for key stocks like TSMC and Foxconn.

Cryptocurrency markets weren’t spared either. CoinGlass data shows liquidation volumes skyrocketing to $892 million, including over $300 million in Bitcoin long and short positions. Bitcoin (BTC) fell to around $77,000, while Ethereum (ETH) dropped to $1,500.

At the center of this storm is Peter Navarro, Trump’s senior trade adviser and a key architect of the administration’s protectionist policies.

On April 6, Navarro appeared on Fox News, attempting to calm investor fears with remarks that many found baffling: “The first rule particularly for the smaller investors out there is you can't lose money unless you sell. Right now the smart strategy is not to panic. Just stay in because we are going to have the ‘biggest boom’ in the stock market we’ve ever seen under Trump's policy.”

This “spiritual victory” approach to economic reassurance, coming from a Harvard-educated economist and senior adviser, was met with widespread skepticism. Critics argue that Navarro’s rhetoric highlights his role not just as a spokesperson but as a driving force behind Trump’s extreme trade protectionism.

Even Elon Musk, a close associate of Trump, recently criticized Navarro publicly, stating, “Having a Harvard economics PhD might not be a good thing—it could lead to overconfidence and poor decision-making.” Musk also questioned Navarro’s lack of tangible achievements, further fueling the controversy surrounding him.

So, while drawing widespread attention, how did Peter Navarro transform from an academic outsider to a key architect of Trump's tariff policies disrupting the global market?

From Academic to Political Fringe

Peter Navarro was born on July 15, 1959, in Cambridge, Massachusetts, to a saxophone player father and a secretary mother. His parents divorced when he was about nine, leaving him to grow up with his mother in Florida and Maryland.

Navarro earned a scholarship to Tufts University in 1972 and later served three years in Thailand with the Peace Corps, an experience that shaped his interest in international trade. He obtained a master’s degree in public administration from Harvard in 1979 and a Ph.D. in economics in 1986.

He joined academia as a professor at the University of California, Irvine, in 1989, where he focused on economics and public policy. Despite his academic success, Navarro repeatedly entered politics, running unsuccessfully for various offices five times between 1992 and 2001. His campaigns centered on economic protectionism and job creation, themes that aligned with Trump’s later “America First” agenda.

The China Threat Theory

From 1989 onwards, Navarro’s academic research began to focus on China, leading to the publication of books like The Coming China Wars (2006) and Death by China (2011), which promoted the notion of a “China threat.” He accused China of undermining the U.S. economy through illegal subsidies, currency manipulation, and intellectual property theft.

Over a decade, Navarro developed a trade confrontation theory advocating strong measures to reverse trade deficits and protect domestic industries. While his views were criticized by mainstream economists as overly simplistic, they gained traction among conservative circles and laid the groundwork for his eventual role in the Trump administration.

From Fringe to the White House

Navarro’s book Death by China didn’t make waves in mainstream economic circles but unexpectedly caught the attention of Donald Trump’s campaign team.

Reportedly, during Trump’s 2016 campaign for his first term, Jared Kushner, Trump’s son-in-law, stumbled upon the book on Amazon. Captivated by its sharp critique of China’s trade practices, Kushner recommended it to Trump. After reading it, Trump was impressed, remarking, “This guy gets what I’m thinking,” and brought Navarro into his team.

In 2017, Navarro became the head of the National Trade Council, where he quickly proposed a 43% tariff on Chinese goods and spearheaded a 25% additional tax on steel and aluminum imports. During the 2018 U.S.-China trade war, he played a pivotal role, famously stating at a White House briefing, “China must pay the price for its unfair trade practices.” That same year, he helped draft Trump’s global steel and aluminum tariff orders, which directly triggered trade disputes with the European Union and Canada.

Navarro’s hardline stance not only aligned with Trump’s “America First” policy but also solidified his position within the White House.

Despite controversies, including a prison sentence in 2023 for contempt of Congress, Navarro remained a key ally of Trump. Upon Trump’s return to the White House in 2025, Navarro resumed his role as a senior trade adviser, championing a “reciprocal tariff” policy based on trade deficits. This included imposing a 46% tariff on Vietnam and a 20% tariff on the EU. In a CNBC interview, Navarro defended these measures, stating, “These are not bargaining chips; they are necessities in a state of national emergency.”

The Cost of Conflict

Trump and Navarro’s policy is set to face a stern test in the global markets of 2025. Unlike many politicians who rely on strategy and diplomacy to achieve their goals, Navarro and Trump’s tariff policies have chosen direct confrontation with trade partner nations, exchanging steep economic costs for what they term “fairness.”

Economists estimate that 60% of tariffs on Chinese goods will drive up prices for imported products, ultimately leaving American consumers to bear the burden of higher costs. As global markets react to Trump’s tariff policies, the ultimate price of Navarro’s strategies remains uncertain.