President-elect Trump has made it abundantly clear that he won’t hesitate to impose tariffs to help achieve goals, such as reversing Joe Biden’s de facto open-border policy. But there are voices in the upcoming administration that want big, permanent, across-the-board tariffs as high as 50%. This would send the U.S. economy and that of the world into a tailspin. The U.S. average tariff is currently 2%.
This segment of What’s Ahead lays out why such a course would be a disaster. Remember, tariff is another word for tax–a sales tax, to be precise. Economic theologians can debate who “pays” what portion of this tax, but it’s a wedge between buying and selling products and services.