US President Donald Trump has announced new tariffs. Combined, these changes would severely hurt American consumers by forcing price increases and supply shortages of many essential goods. Today’s proposed tariffs include a 10% levy on nearly all foreign goods. In addition, they hit our own constituents with a mind-numbing 145% tariff on imports from China, our third largest source of imports.
That’s not where the story ends. That means prices are almost certain to increase over the next several months, particularly for apparel, leather goods, electronics and toys. Many of which are manufactured in China. Yet this maneuver has more than doubled the average effective tariff rate on US imports. It has climbed to its highest point in more than 100 years.
As the tariffs go into effect, consumers will soon see reach shortages in the short term. This last issue will especially impact products for which China is the largest global supplier. Everyday items like baby carriages, coloring books, and umbrellas are just a few examples of goods at risk of becoming unavailable. Economists at the Yale Budget Lab are strongly cautioning that clothes prices may soon need to increase by more than 62%. This increase is a reflection of their new forecasts. Basic pharmaceutical products are expected to face 12% increases, with food prices increasing by 2.6%.
The confusion over these tariffs has already start to impact consumer shopping patterns. As these graphs show, leading up to Trump’s announcement major retailers saw a drop in traffic while their stocks plummeted. Consumers rushed to spend, concerned that prices were about to increase dramatically. Local shoppers, including Anna Woods, shared their apprehensions about the fast-developing scene.
“I can’t keep up with the president. Every day is something new,” – Anna Woods
Woods further remarked, “I just feel like we’re living in uncertain times.” She added, “I do need to make some purchases… Everything is going up.” Consumers are right to feel anxious about the current crypto market situation. This trepidation largely comes from fears over new financial burdens imposed by the tariffs.
Retailers are feeling the pressure. Store owner, Richard Medina, recognized how critical it was for them to pivot to meet new market realities.
“We’ve got to switch this out now,” – Richard Medina
The tariffs have driven a 25% increase in new business through Amazon’s e-commerce platform. This increase coincides with more Chinese marketplace sellers of all sizes putting their products online. This trend highlights the ongoing shift in consumer behavior as shoppers seek to stock up on essentials before potential shortages occur.
Louis Lopez, a consumer just getting ready for the upcoming changes, helped counsel other consumers on what they can do next.
“You might as well buy it now… while you have it good,” – Louis Lopez
The implications of these retaliatory tariffs go beyond retail consumer products. We estimate that the average American family would pay about $4,700 more as a result of these new taxes. This figure does highlight the tremendous economic cost that will befall our economy under the administration’s current trade policy.
“It’s going to change everything for everybody,” – Louis Lopez
Cristina Montoya, another shopper, echoed the sentiment, saying that the shopping scene has been “really intimidating right now.”
Skyrocketing prices and an impending consumer supply crisis have left consumers anxious. They’re nervous too, as they look to procure the products needed to fulfill their budgets. Rippling effects from supply chain disruptions caused by these tariffs threatened to leave us all without many of these essential items. Unfortunately, American families are feeling the pinch as they attempt to adjust.
“You never used to do your shopping nervous,” – Cristina Montoya
The combination of rising prices and the threat of product shortages has created a palpable sense of unease among consumers as they navigate their purchasing decisions. With many essential items at risk due to supply chain disruptions caused by these tariffs, American families are left grappling with how to adapt.