WASHINGTON — April 7, 2025
U.S. Commerce Secretary Howard Lutnick has defended the Biden administration’s sweeping new tariffs—some of which extend to uninhabited and penguin-inhabited regions—as necessary measures to close all possible loopholes in America’s global trade policy.
Speaking on CBS News’ Face the Nation, Lutnick explained that President Trump’s latest round of tariffs, which includes a 10% duty on nearly every country in the world, is intended to prevent companies from using obscure or remote regions as backdoors to access U.S. markets.
Among the most eyebrow-raising examples: Heard and McDonald Islands, a pair of Australian territories in the Southern Ocean that haven’t seen human activity in almost a decade and are populated exclusively by penguins. Despite lacking ports, people, or commercial activity of any kind, the islands are subject to the same duties as Australia itself.
“There are no countries left off,” Lutnick said. “If you leave anything off the list, countries will try to arbitrage America by going through them.”
Lutnick cited past examples, particularly China’s 2018 strategy of redirecting exports through third countries to sidestep tariffs, as the rationale behind leaving no stone—or iceberg—unturned in the latest trade crackdown.
“They just built through other countries, through America,” Lutnick continued. “The president knows that, he’s tired of it, and he’s going to fix that.”
Penguins and Policy
Critics have pointed out the absurdity of extending tariffs to remote, infrastructure-less islands that have no capacity for trade activity whatsoever. There are no ports, no roads, and certainly no penguin-run logistics hubs to serve as a conduit for Chinese transshipments.
Even so, the White House insists that no exemptions can be made—even for places with only wildlife residents—so that countries cannot manipulate trade rules by routing products through “grey zones.”
“It’s about setting a uniform precedent,” a senior White House official told reporters anonymously. “If a location is part of a sovereign trade partner, it falls under the same policy—regardless of population, or species.”
Reality Check
While companies can, in theory, avoid tariffs by relocating production or sourcing to favorable regions, experts note this is not feasible for the Heard and McDonald Islands. The islands are environmentally protected, ice-covered, and devoid of human infrastructure.
A March report by NPR outlined three legitimate methods for avoiding tariffs—relocating production, changing the country of origin through substantial transformation, and forming trade partnerships—all of which are impossible in locations like the penguin-filled outposts.
“Even trans-shipment strategies don’t apply,” said one trade compliance expert. “There are no facilities to handle goods there, and no one to forge the paperwork—even if someone were willing to commit customs fraud.”
A Broader Trade War Strategy
The tariffs are part of what Trump has branded “Liberation Day”, a sweeping global realignment of U.S. trade policy announced last month. The administration’s goal is to bring manufacturing back to the United States by making it more costly to import goods from abroad.
“We want companies to build here. If they want to sell to American consumers, they should be hiring American workers,” Lutnick emphasized.
Still, the symbolic nature of targeting lifeless islands has invited widespread mockery on social media and scrutiny from economists, who argue that the policy may be more performative than practical.
One viral meme showed penguins dressed in hard hats unloading crates labeled “Made in China” with the caption: “The real threat to American manufacturing.”
As Trump continues to double down on protectionist trade policies, one thing is clear: in this administration’s eyes, not even penguins are above suspicion.
