Big Thought, Small Step, Deep Breath — for March 5, 2025
By ANAND GIRIDHARADAS
Welcome to the Trump economy. No matter how much President Trump tried to hype the economy last night, the numbers don’t lie. Your stock portfolio and/or retirement account is shriveling, business leaders are panicking, and today we are reporting that the new Trump tariffs could cost the average American family $2,000 this year.
To put that sum in context, it is enough money to buy three pairs of Trump’s official victory sneakers, plus 100 dozen eggs.
Welcome to the Resistance, everyone who didn’t think that Trump is dangerous but did think he would be good for business.
After a month of gamesboyship, the Trump tariffs finally went into effect on Monday: new 25 percent levies on imports from Canada and Mexico; plus another 10 percent on Chinese imports, on top of the 10 percent imposed in February. All three countries — America’s biggest trading partners — are retaliating with tariffs on U.S. exports. As predicted, the stock market’s nosedive intensified as investors sold off stocks, anticipating a further slowdown in consumer spending.
The tariffs imposed during the first Trump administration were relatively inconsequential, but this time they’re likely to have a much bigger impact: the world economy is more fragile, the tariffs themselves are broader in scope, and there is nobody within the administration to put the brakes on. There is less that lawmakers could do even if they were motivated to push back, since Trump has invoked emergency powers — supposedly to address the threat of fentanyl trafficking — to conduct his chaotic and manic trade war.
Today’s Big Thought is about how this affects you — and, frankly, how it affects Trump supporters (current ones, at least) whom you might know and talk to.
A tariff is a tax on imports. Despite what Trump thinks, that tax gets paid not by China or Mexico or Canada, but by whoever imports goods into the country. And those importers face a choice — they can keep prices the same and make less money once they sell those goods in the U.S., or they can pass the costs along to consumers.
What do you think they tend to do?
Ding ding ding! They pass it on. So the tariff very quickly becomes a tax — on you.
Since tariffs are collected on everything from finished goods and food to raw materials like lumber and consumables like oil, they can affect almost everything you buy. That means higher prices — inflation, as economists call it. Remember it?
You’re going to pay more for stuff. And how much more will this Trump tax cost you?
The Budget Lab at Yale has just crunched the numbers, and what they found is damning. American households can expect to lose an average of $2,002 in real income this year, assuming that America’s trading partners-turned-adversaries retaliate in full, which is likely. So that is a $2,000 tax hike on every American household.
Every single Democratic Party official needs to be chanting this phrase nonstop from now on: the $2,000 Trump tax. Forward this item to your most Trump-loving friends and relatives. (Hi, newcomers! Welcome to The Ink. Hope you have $2,000 saved!)
Source: The Ink