Reveal What Trump’s Tariff Shock Will Cost You
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Apr 16, 2025 Justin Wolfers, an economist from the University of Michigan known for his insights on happiness and income, discusses the ramifications of Trump's tariffs. He explains how these tariffs deviate from traditional economic principles and could lead the U.S. into an unnecessary recession. Wolfers critiques the unrealistic expectations of job growth tied to these policies and highlights their negative impact on consumer prices and confidence. He also contrasts current tariffs with historical approaches, emphasizing the broader implications for global trade.
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Tariff Rates Skyrocket
- The average tariff rate in Trump's first term was 3%, doubling the pre-Trump 1.5%. Now in his second term, it's 25-32%, the highest in U.S. history, causing major economic pain.
Tariffs Raise All Prices
- When Samsung raised washing machine prices due to tariffs, American manufacturers increased their prices by the same $100. Interestingly, prices of dryers, not affected by tariffs, also rose by $100.
Tariffs Won’t Bring Jobs Back
- Tariffs won’t bring back manufacturing jobs because future tariff uncertainty delays investment. American manufacturing uses robots, limiting low-skilled job growth despite high output.