The tariff costs are hitting home, literally. Prices have increased 6.9% for bananas and 18.9% for coffee over the past 12 months, according to government figures. Who wouldn’t be cranky about paying $6 for a dark roast cup of joe? Trump officials say exporters pay the tariffs, but consumers see the opposite each day at Starbucks.
Businesses have been passing on the border taxes to consumers to varying degrees. Some are also slowing hiring and putting investments on hold because of tariff uncertainty. Consumer sentiment on the University of Michigan’s survey last week fell to a near record low—near the same level when inflation peaked at 9.1% in June 2022.
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Mr. Bessent also blamed the Biden crowd for the “affordability mess,” which is true as far it goes. But Mr. Trump’s tariffs are making daily life less affordable now. Americans want a tariff reprieve for more than coffee and bananas.
“Trump’s tariffs are costing companies. Keeping up with them may cost even more.” (HT Scott Lincicome) Two slices:
Businesses from Wall Street to main street are struggling to comply with President Donald Trump’s byzantine tariff regime, driving up costs and counteracting, for some, the benefits of the corporate tax cuts Republicans passed earlier this year.
Trump has ripped up the U.S. tariff code over the past year, replacing a decades-old system that imposed the same tariffs on imports from all but a few countries with a vastly more complicated system of many different tariff rates depending on the origin of imported goods.
To give an example, an industrial product that faced a mostly uniform 5 percent tariff rate in the past could now be taxed at 15 percent if it comes from the EU or Japan, 20 percent from Norway and many African countries, 24 to 25 percent from countries in Southeast Asia and upwards of 50 percent from India, Brazil or China.
“This has been an exhausting year, I’d say, for most CEOs in the country,” said Gary Shapiro, CEO and vice chair of the Consumer Technology Association, an industry group whose 1,300 member companies include major brands like Amazon, Walmart and AMD, as well as many small businesses and startups. “The level of executive time that’s been put in this has been enormous. So instead of focusing on innovation, they’re focusing on how they deal with the tariffs.”
Upping the pressure, the Justice Department has announced that it intends to make the prosecution of customs fraud one of its top priorities.
The proliferation of trade regulations and threat of intensified enforcement has driven many companies to beef up their staff and spend what could add up to tens of millions of dollars to ensure they are not running afoul of Trump’s requirements.
The time and expense involved, combined with the tens of billions of dollars in higher tariffs that companies are paying each month to import goods, amount to a massive burden that is weighing down industries traditionally reliant on imported products. And it’s denting, for some, the impact of the hundreds of billions of dollars of tax cuts that companies will receive over the next decade via the One Big Beautiful Bill Act championed by the White House.
“Every CEO survey says this is their biggest issue,” said Shapiro.
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The nonpartisan think tank’s new report, “Unintended Consequences: Trade and Supply Chain Leaders Respond to Recent Turmoil,” is the first in a new series exploring how companies are navigating the evolving trade landscape, he said.
One of the main findings is that it has become very difficult for companies to make decisions, “given the high degree of uncertainty” around tariff policy, [Matthew] Aleshire said.
Who is Wilson? She does not own a car. She lives in a rented 600-square-foot apartment with her husband and two-year-old daughter. By her own account, she depends on checks from her parents back east to cover expenses. To let them off the hook, she seeks to force residents of Seattle to pay for “free” child care and other goodies.
Fourteen years ago, after working odd jobs as a barista, baker, lab technician and legal assistant, Wilson co-founded an advocacy group called Transit Riders Union to agitate for better public transportation, paid for by new and higher taxes. She says she decided to challenge Mayor Bruce Harrell (D) earlier this year after he opposed a new tax on high earners to pay for housing construction. She campaigned on a local capital gains tax, a digital advertising tax and a statewide wealth tax.
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Like the mayor-elect in New York, Wilson wants to open government-run grocery stores, despite their record of failure. She suggested during a September event that she won’t allow private supermarkets to close locations that aren’t profitable. Instead, she wants to require them to give more notice and pay generous severance packages to their employees. “Access to affordable, healthy food is a basic right,” Wilson said.
Wilson may be less constrained than Mamdani. Fellow progressives also toppled the incumbent president of the Seattle City Council and the city attorney while picking up two other seats. Only two of the seven council members have served more than one term. There are not many silver linings here, except that the country may be able to more quickly see the failures of their policies — which could prevent voters in other cities from falling for socialism.
Paul McDonald describes “the savage heart of socialism.”
Mitch Daniels decries the the warping of public norms. Two slices:
Allow me to start at the relatively trivial end of the list. Profanity is suddenly mainstream. Once unacceptable words, specifically the one you know I’m thinking of, are everywhere. From comedians who apparently couldn’t get laughs without them, to politicians who must think it makes them look tough, the grossness has now infected even our formerly proudest and most stately publications. However one might wish, it seems unlikely that once the vulgar becomes commonplace, society will ever re-rule it out of bounds.
The infantilization of political debate, and personal demonization of opponents, may similarly have ratcheted downward, although on this score one can imagine some recovery. At some point, the public could tire of playground insults and asinine nicknames, and start asking for a little more substance from those elected to serve them. Interminable stalemate, especially when the country enters a stretch of serious economic or national security difficulty, could trigger a collective demand to “Grow up.”
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Cronyism has enjoyed a good run lately. The Biden administration’s lavish funding of politically aligned unions and nonprofits has been succeeded by pay-to-play favoritism of the old-fashioned kind. For the moment, the public is passively tolerant. But a Credit Mobilier, Teapot Dome or Watergate-like episode could well send a pendulum back toward higher ethical expectations.
Finally, there is lawfare. Both sides’ hands are filthy, and the ugly game of tit-for-tat may continue. But here, there is the opportunity for the nation’s courts to play both a restraining and a tutorial role.
When President Obama saw how many people preferred ObamaCare-exempt plans, he kneecapped the competition. For 20 years, presidents from both parties had allowed short-term plans to last up to 12 months. But in 2016 Mr. Obama prohibited them from lasting more than three months, which reduced consumer protections and stripped coverage from patients after they got sick.
In 2018 Mr. Trump removed those restrictions and freed those plans to offer greater protection. He clarified that federal law allows short-term plans to last 36 months and to offer renewal guarantees. Renewal guarantees give patients who develop expensive illnesses the perpetual right to re-enroll in their health plan at healthy-person premiums.
Multiple federal courts upheld Mr. Trump’s rule as a reasonable and valid interpretation of existing law—including its clarification that the law allows renewal guarantees to offer longer-term protection to people in short-term plans.
Freeing consumers from ObamaCare’s hidden taxes made coverage dramatically more affordable for the majority of enrollees. The Congressional Budget Office found that consumers could purchase a “comprehensive major medical policy” at premiums “as much as 60 percent lower than premiums for the lowest-cost bronze plan.” Premiums fell so much that people could afford health insurance without a government subsidy. Perhaps that’s why President Biden rescinded Mr. Trump’s action in 2024.
Congress can make health insurance affordable for millions, without spending a dime, by codifying Mr. Trump’s 2018 rule into law.
Here’s Samuel Gregg on “Tocqueville versus the Groypers.” Three slices:
Politically speaking, [Arthur de] Gobineau’s racialist principles led him to favor conspicuously authoritarian governments. Initially, Gobineau dismissed the Second Empire established in France shortly after Louis-Napoleon Bonaparte’s coup d’etat of 1851 as a mere facsimile of true monarchy. By the mid-1850s, however, Gobineau was full of praise for Napoleon III’s regime. It exemplified, to his mind, the centralized authority that rulers needed to control unruly populations. The consequences for liberty were, to Gobineau’s mind, irrelevant.
Gobineau’s adulation of Napoleon III put him in an entirely different political camp from Tocqueville. The latter never hid his antipathy to the Second Empire’s authoritarianism or the unconstitutional way the regime had come to power.
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Against such positions, Tocqueville affirmed a proposition that he regarded as self-evident: that being the essential “unity of the human race.” For Tocqueville, there were no superhumans or subhumans. There were simply humans. That self-evident truth, Tocqueville believed, was foundational to his brand of liberalism as well as natural law and Christian morality. By contrast, Tocqueville insisted, Gobineau’s suppositions about race led to the conclusion that we live in a world in which “there are only victors and vanquished, masters and slaves by fact of birth.” It was no coincidence, Tocqueville stated, that Gobineau’s “doctrines are approved, cited and commented upon … [by] the owners of negroes in favor of eternal servitude.”
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In short, there was nothing redeemable about Gobineau’s race theories and their consequences for politics because the more Gobineau articulated them, the more Tocqueville recognized that they were marked by an inner logic that was not only empirically false but morally reprehensible. That made Gobineau’s racialist views something that could only stain any institution or political movement that flirted with them.
In his time, Tocqueville refused to accord any legitimacy whatsoever to such positions wherever they reared their heads. He also declined to let individuals advancing or tolerating such ideas off the intellectual and moral hook. In our time, there should be no hesitation on our part to do the same.
