With yet another round of tariffs taking effect this week — this time on cabinets and other furniture, timber and lumber — the White House insists that its policies are about "fairness" and "reciprocity."
The evidence now tells a different story of higher prices for Americans, lower margins for U.S. firms, collapsing exports in flagship industries, investment paralysis and mounting risks of an economic slowdown.
Start with exports.
American goods are losing ground fast.
A recent KPMG survey finds that "60% of businesses reported decreased overseas sales" in the first six months of President Donald Trump's tariffs.
For instance, U.S. liquor exports tumbled 9% in the second quarter of this year, with steep declines across the European Union, Canada, Britain and Japan, which together buy about 70% of these exports.
In another example, China — once a key customer for U.S. farm goods — has turned instead to Argentina and other suppliers, and total U.S. soybean exports are down 23% this year.
Smaller companies are also adversely affected.
A valve and gas component maker in Napa Valley just announced that it will shut down a plant and discharge 237 employees, citing weak overseas demand linked to tariffs.
Let's not forget the upcoming Supreme Court case of V.O.S. Selections, Inc. v. Trump, No. 2518 (Fed. Cir. 2025) where U.S. importers and resellers of wine, electronics kits, apparel and other goods argued that the April 2 "Liberation Day" tariffs disrupted their supply chains, forced steep price increases, and threatened their viability.
American consumers, too, are paying the price.
KPMG finds that nearly half of American companies have already raised prices because of tariffs; two-thirds have passed at least part of those costs on to shoppers; and nearly 40% have paused hiring, with a third cutting jobs.
CEOs overwhelmingly expect tariffs to weigh on business for years.
Goldman Sachs estimates U.S. consumers are now footing 55% of the total tariff bill, while foreign exporters bear only a sliver of the costs.
Sometimes, though, the cost we pay isn't higher prices — it's no product at all.
One of Europe's largest farm-equipment manufacturers, Krone, has halted U.S. sales after a new wave of "steel derivative" tariffs required exporters to document the origin, weight and value of every screw, nut and bolt in their machinery.
This bureaucratic tangle is so extreme that many European manufacturers are simply giving up. For American farmers waiting on harvesting equipment, that means delays, shortages and higher costs down the line.
The chaos doesn't stop there.
UPS has been drowning in a customs backlog since the administration scrapped the longstanding rule that allows imports costing less than $800 to enter the U.S. duty-free.
Thousands of packages, from Japanese tea to engagement rings, are stuck or even "disposed of" because of missing tariff paperwork.
It's a vivid reminder that protectionism jams everyday commerce.
No product is too small.
Italian pasta makers warn that Trump's new duties, some nearing 92%, could double the price of a $4 box of rigatoni. Italian newspapers have dubbed it "Trump's war against pasta."
Rome and Brussels accuse Washington of strong-arming companies like Barilla and Garofalo into producing in the U.S.
Either way, the result is Americans paying more for our dinners.
Get ready for your kids' lunches to get more expensive too.
Peanut butter could be swept into expanding steel and aluminum tariffs, with petitions asking the Commerce Department to treat food products packaged in metal as "derivatives" (subject to a 50% percent national-security tariff) under consideration.
So much for draining the swamp.
All of this explains the wild uncertainty business leaders have experienced in recent months. Retailers are now bracing for 100% tariffs on Chinese goods scheduled for Nov. 1, right before the holiday rush.
Some firms have scurried to ship early, but even a few days' delay at sea could blow up their margins.
With deadlines set, delayed and often re-announced with each press conference, companies can't plan or invest.
The big-picture story isn't any better.
Each new round of tariffs rattles markets and makes investors more nervous about what the White House might do next.
The result is a toxic mix for the economy: higher prices, slower growth and growing fears of stagflation.
For the Treasury and the Federal Reserve, that means harder choices on interest rates and a rising risk that emergency measures to keep the financial system steady will be called for.
U.S. tariffs are taxes on Americans, and stealthy ones.
They show up as higher prices in grocery aisles, lower wages for factory workers, and greater global risk premia.
If Washington truly wants lower prices, stronger investment and resilient supply chains, officials should see at this point that the answer isn't higher tariff walls.
It's stable rules, open markets and the simple economic truth that prosperity grows from trade.
(Editor's Note: A related article may be found here.)
Veronique de Rugy is a senior research fellow at the Mercatus Center at George Mason University. Her primary research areas include the U.S. economy, federal budget, homeland security, taxation, tax competition, and financial privacy. She has been featured on "Stossel," "20/20," C-SPAN’s "Washington Journal," and Fox News. Ms. de Rugy has also been a resident fellow at the American Enterprise Institute, a policy analyst at Cato , and a research fellow at the Atlas Economic Research Foundation. Read Veronique de Rugy's Reports — More Here.