Mamma Mia! How A Panic Over Pasta Prices Prompted A Trump Tariff Retreat.

A monthslong crackdown within the Trump administration to soften its trade rules all started with a flap over pasta.

In the aftermath, Commerce Secretary Howard Lutnick and other top Commerce Department officials are leaning on agency staff not to drive up tariffs on grocery items and other goods ahead of the midterm elections.

The interference is a vivid reminder of just how improvisational much of Trump’s trade agenda is, with decisions driven by political considerations and personal calculations as much as by law, alliances and existing trade pacts.

Agency leaders first stepped in late last year, after a Commerce Department investigation determined in September that leading Italian pasta makers had been underpricing the products they sold in the U.S., in violation of trade rules. The proposed punishment — sky-high tariffs on the pantry staple — drew headlines at a time when the administration was trying to convince Americans its trade agenda was not driving up prices.

"Lutnick was very upset that the work was making it on the news, from the perspective that he was responsible for inflation," one of the people said. "Then he became a micromanager. He micromanaged every decision that came out to try to water down enforcement and compliance."

In particular, he and other top Commerce officials have discouraged staff from pursuing the most aggressive possible tariffs in the pasta case and other similar investigations into trade violations, according to four people familiar with the matter, granted anonymity to share unreported details about the internal discussions.

In some cases, senior officials instructed staff to recalculate rates that were deemed too high, two of the people said. The result has been much lower duties on violators in recent months compared to the past.

Those decisions are worrying career Commerce officials as well as other trade and legal experts, who say the rates for any new duties should be based on hard data and legal criteria. And it illustrates how concerns about inflation and affordability approaching the midterm elections have begun to override Trump's desire to crack down on foreign companies that cheat domestic industry.

A Commerce official denied that Lutnick had intervened in the rate decisions, or that the agency had changed its practice of assigning higher duty rates to companies that don’t participate in its investigations.

“Secretary Lutnick has not directed Commerce staff to apply or avoid any particular rates or set of rate options,” the official said in a statement to POLITICO. “Commerce follows a transparent and established decision making process for each case.” The official was granted anonymity to speak about the department's decision-making.

The main government tools for combating this kind of cheating are known as “antidumping” and “countervailing” duties. The Commerce Department's International Trade Administration is responsible for conducting investigations into alleged cheating, typically at the request of American companies, before deciding what, if any, penalties to impose. Under federal laws dating back more than a century, these penalties are supposed to be based on how far the foreign imports in question are priced below their market value or how heavily a foreign government subsidizes them.

The narrow and targeted scope of the duties, which apply to specific companies and products, mean they rarely drive inflation. But the optics of the extremely high proposed rates on Italian pasta and other consumer products and manufacturing inputs, including Chinese wooden cabinets and Russian palladium used in auto parts, have alarmed Lutnick and other senior agency officials as the administration works to tamp down affordability concerns.

The Commerce secretary, who has fought to keep himself at the center of the White House economic agenda, was determined not to let his department's decisions feed one of the president’s biggest political vulnerabilities.

Lutnick signaled to staff across meetings and private correspondence in the fall of 2025 that the administration would no longer prioritize the most aggressive forms of enforcement, according to the four people. In a meeting in March, senior Commerce officials told private-sector lawyers about the new approach, stressing that the administration would no longer back the most aggressive form of enforcement, two of the people said.

That same month, the Commerce Department finalized the tariffs on the Italian pasta companies at a maximum rate of 7 percent for Garofalo and a minimum of 2.65 percent for La Molisana, while 11 other Italian companies were hit with a 5.21 percent duty — far lower than the 91.74 percent rate initially proposed.

Much of the information the Commerce Department compiles as part of its investigations into a product’s pricing is proprietary, so it’s difficult to evaluate the justification behind the tariffs the agency proposes on any given company — or changes they make before finalizing the duties.

The Commerce Department official said its staff determined the lower rate was appropriate after receiving additional information from the Italian pasta companies and getting a more accurate picture of sale price data.

But a second person familiar with the pasta case said, “The final penalty, absolutely, should have been higher. It is not the business of the administration to get cold feet about the size of some of these margins.”

Since the fall, Commerce officials overseeing antidumping and countervailing investigations have selected the lowest tariff option under consideration in the overwhelming majority of cases, two of the people familiar said. One of the people said that career staff initially chose the highest rate 90 percent of the time, but senior leadership would “ask to redraw the numbers” if all the options seemed too high.

It's been standard practice for decades for the Commerce Department to hit companies that fail to comply with trade investigations with the highest possible rate — including above 200 percent. But since November, the department has softened its approach to noncooperative companies, and has retreated from higher rates it initially proposed based on available data in many of its investigations, according to the four people familiar with the cases.

A trade lawyer close to the White House said Commerce is "definitely deviating away from what their practice has been for many, many years, probably even decades," in terms of imposing the highest available tariff rate on companies that fail to cooperate with investigators.

The department is also, however, responding to recent court rulings that have said it cannot use excessive tariff rates to punish non-cooperative companies. The department has wide discretion to pursue a rate that is the highest supported by the available data, plus a small penalty to deter noncompliance, a Commerce official said. But companies have successfully challenged tariffs stemming from trade investigations that judges deemed excessively high.

“The courts have pushed back and made them go back and try again,” said a trade lawyer granted anonymity to discuss the court decisions. The lawyer said this has also created an environment where the Commerce Department feels like it can’t levy the highest duties on non-cooperative firms.

Commerce officials “feel some pressure there, unfortunately,” the lawyer added.

The shrinking penalties have drawn attention from lawmakers of both parties. In a June letter to Lutnick, House Select Committee on the Chinese Communist Party Chair John Moolenaar (R-Mich.) and ranking member Ro Khanna (D-Calif.) demanded to know whether the Commerce Department had quietly abandoned its practice of hitting non-cooperative firms with the steepest rates.

In particular, they pointed to the Russian palladium case, where they say producers refused to cooperate — normally a trigger for the harshest penalty available. Yet Commerce in April set a final antidumping rate of 132.83 percent, far below the 828.09 percent the petitioners who requested the investigation had sought. The duties never went into effect, however, after the International Trade Commission, which determines whether imports are harming a U.S. industry, did not find evidence that imports were hurting U.S. producers.

“Lowering rates despite non-cooperation from foreign competitors sends a dangerous signal to bad actors: refusing to participate in the Department’s investigations may lead to more favorable outcomes than cooperation,” Moolenar and Khanna wrote.

Sen. Ron Wyden (D-Ore.), the top Democrat on the Senate Finance Committee, sent a letter last month stressing that the process for determining trade penalties must "remain apolitical and free from conflicts of interest," citing the case of a South Korean aluminium company whose parent company reportedly paid $2 million to the Trump Organization last year while its aluminum affiliate was fighting proposed Commerce Department duties.

Other cases reflect similar reductions. In an antidumping case on a chemical used to make insulating foams and sealants from China, the ITA set preliminary tariff rates of up to 511.75 percent in September 2025, but in April 2026 the agency issued a final rate of up to 159.04 percent. In another investigation of container chassis from Thailand, a dumping rate assigned to one producer, Panus Assembly, fell from an initial rate of 181.57 percent to 129.63 percent in the final order in April.

In each of these cases, Commerce says it adjusted the tariff rates after additional information was gathered between the preliminary and final determinations to create a more accurate estimate of the anti-dumping margins.

The laws targeting trade cheats are some of the most precise trade statutes on the books, laying out strict criteria for when the duties can be applied and lifted, as well as what Commerce and the ITC should look for when determining rates and outcomes.

Trade attorneys say the administration could face lawsuits if the lower rates can't be justified by the economic data.

"The statutes tell them how to calculate a rate. It doesn't tell them to pick the lowest one because they're worried about grocery prices. That's the problem," a lawyer who works on trade remedy cases said. “Is it legal? I have some serious questions about that.”