Confused about Tariffs? You are not alone. President Trump’s misleading explanation of tariffs on April 2nd, 2025 is leaving many nations, businesses, and people in a state of uncertainty. But one thing is clear: President Trump’s tariffs are terrific.
1. of great size, amount, or intensity.
2. extremely good; excellent.
3. causing terror.
Tax Season:
Tariffs are government fees charged on imported or exported goods. It’s similar to a sales tax that increases the price of a product at the time of purchase. State governments receive sales tax fees and the federal government receives tariff fees.
Alaska, Delaware, Montana, New Hampshire, and Oregon may be the only U.S. states with no sales taxes.
(Forbes, 2022)
Price tags often exclude the costs of a sales tax. So many shoppers are conditioned to expect a slightly higher purchase price at checkout. If you have ever been unpleasantly surprised by sales taxes, you can imagine what a lot of U.S. trade partners may be feeling right now.
President’s Trump tariffs are the largest since 1909.
(USfunds.com, 2025)
Paying your Tithe:
Trump’s April 2nd tariff announcement requires foreign companies to pay a 10% tax on goods they ship to the United States. That’s like your home state announcing a 10% sales tax. That would mean a product listed for $10 would actually cost $11. If you bought $200 of groceries, the cost at checkout would be $220. So U.S. trading partners must now pay the United States at least 10% of the value of their products upon arrival.
President Trump’s tariffs could result in a $3,800 loss per average U.S. household.
(yahoo.com, 2025)
So, how do foreign companies afford that? They charge higher prices to U.S. businesses buying their products. How do businesses afford that? They charge higher prices to customers buying their products. How do you afford more expensive foreign products? You don’t. You prioritize.
The Conference Board Consumer Confidence Index is below the low level that has historically occurred in proximity to economic recessions.
(Conference-Board.org, 2025)
So, tariffs tend to raise money for the federal government while raising the prices of foreign products for consumers (Berstein, 2025; York, 2024). And the United States buys A LOT of foreign products: cocoa beans for chocolate, coffee beans for coffee, apparel/clothing products, fish for seafood, electrical equipment, and textiles (Sergent, 2025). But can tariffs do some good?
The Dixieland Start-Up:
Yes, but only if people pivot to buying more products made in the United States. Businesses that rely on domestic production processes will grow if the quality and quantity of their products meets market demand. The trouble is other countries tend to make cheaper products due to lower labor and manufacturing costs. So, who wants to find/fund/force some free labor to start a coffee and cocoa bean plantation, fishery, and sweat shop in Hawaii?
The Boston Tariff Party:
America has it’s fair share of cheap labor, but it also has rules like civil rights and child-labor laws. So, it may still be a little early for a plantation/fishery/sweat shop start-up in Hawaii. A more likely scenario is that people protest tariffs in increasing numbers as soon as they start to feel the pain of having to pay for them.
“Every system is perfectly designed to get the results it gets.”
– W. E. Deming & Some Other Guy
Protests vs Plantations:
These two scenarios are dramatic oversimplifications, but which path sounds better to you? Plantation products? Or, protest parties?
The Hidden Menu:
Life often fools me into thinking it is dichotomous. So, those are unlikely to be our only two options. We might be able to place an off-menu order… But I don’t know what that would be. Do you?
Sources:
Berstein, J. (2025, January 31). What are tariffs and how do they affect you? Investopedia. https://www.investopedia.com/news/what-are-tariffs-and-how-do-they-affect-you/
Sergent, J. (2025, April 4). Tariffs in 2025 will hit these Americans and things we buy the hardest. USA TODAY. https://www.usatoday.com/story/graphics/2025/04/03/trump-tariffs-prices-americans-impact/82792737007/
York, E. (2024, April 16). Separating tariff facts from tariff fictions. cato.org. https://www.cato.org/publications/separating-tariff-facts-tariff-fictions
Deliberating Truth 