Nobel Prize-winning economist Paul Krugman is warning that President Donald Trump’s “Liberation Day” tariffs are backfiring, as he argues that China now holds the upper hand in the escalating trade war. In his newsletter on Monday, Krugman said that Trump’s tariff announcements six months ago were “a massive betrayal of the world's trust,” noting that previous tariff reductions were achieved “through many rounds of international negotiations, in which the U.S. and other nations solemnly agreed not to backtrack.”