#TrumpTariffs
Direct Tax on Imports: Tariffs are taxes paid by importers, often passed on to US consumers and businesses, leading to higher prices (inflationary pressure).
Increased Average Tariff Rate: The average effective US tariff rate has increased significantly, reaching the highest level since 1941.
Negative GDP Impact: Economic models show that the tariffs, even before foreign retaliation, are estimated to reduce long-run US GDP (e.g., by 0.6% or more).
Supply Chain Disruption: They disrupt global supply chains and lead to increased policy uncertainty, causing firms to postpone investment and hiring decisions.
Small Business Alarm: Small businesses are particularly vulnerable, with many reporting being forced to raise prices or facing difficulty surviving due to thinner margins.
Market Volatility Driver: The threat and implementation of tariffs are known to increase volatility in traditional markets (stocks, commodities).
