{"id":299957,"date":"2026-01-23T19:02:15","date_gmt":"2026-01-23T19:02:15","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/299957\/"},"modified":"2026-01-23T19:02:15","modified_gmt":"2026-01-23T19:02:15","slug":"americans-are-carrying-the-bulk-of-the-tariff-burden-designed-to-boost-domestic-us-economy-the-irish-times","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/299957\/","title":{"rendered":"Americans are carrying the bulk of the tariff burden designed to boost domestic US economy \u2013 The Irish Times"},"content":{"rendered":"

Jerry Samet has lived in High Point, a small town in North Carolina that has styled itself as the heart of the global furniture industry, for most of his life. After taking the helm of his father\u2019s business<\/a>, he works from a sprawling warehouse on the edge of town whose showrooms are peppered with bright chairs and desks.<\/p>\n

But in recent years the furniture industry veteran has watched the once vibrant sector of his hometown decline. Over decades of global trade liberalisation measures, the US furniture industry turned to countries such as China, Mexico and Vietnam for parts and finished pieces. North Carolina alone has lost more than 60,000 furniture-making jobs since 1990.<\/p>\n

This is the dynamic that Donald Trump and his trade officials <\/a>have said they were trying to reverse with a targeted move in their series of high duties on imported goods.<\/p>\n

[\u00a02026 is year of living dangerously for investors and marketsOpens in new window<\/a>\u00a0]<\/p>\n

In October, Trump introduced sweeping tariffs of 25 per cent on imports of kitchen and bathroom cabinets and upholstered wood furniture, along with levies of 10 per cent on lumber.<\/p>\n

The aim, the president <\/a>posted on social media in advance of the announcement, was to \u201cmake North Carolina, which has completely lost its furniture business to China … GREAT again.\u201d<\/p>\n

Samet\u2019s company, High Point Furniture Industries, which still makes all its furniture in the US and buys the vast majority of its inputs and raw goods from other US companies, might have been expected to benefit from the new regime.<\/p>\n

But companies like it say in fact they are now paying more for their parts as other businesses pass on the cost of tariffs, which include duties of 50 per cent on an array of steel and aluminium products, as well as \u201creciprocal\u201d tariffs ranging from 10 to 50 per cent on almost every trading partner.<\/p>\n

\u201cWe are buying from distributors in the US, but they have imported [goods] and have to pass the tariff on to us,\u201d says Samet. \u201cThat\u2019s the situation we have, they pass it on to customers.\u201d<\/p>\n

And often it is ordinary Americans who pay the final bill. A new study from a German think tank concluded that the Trump duties on imported goods <\/a>are paid almost entirely by American importers, their domestic customers and ultimately US consumers. <\/p>\n

\u201cForeign exporters did not meaningfully reduce their prices in response to US tariff increases,\u201d a report released Monday by the Kiel Institute for the World Economy said. \u201cThe $200 billion (\u20ac171 billion) surge in customs revenue represents $200 billion extracted from American businesses and households.\u201d<\/p>\n

The study found that only about 4 per cent of the tariff burden is shouldered by foreign firms, with a \u201cnear-complete\u201d pass-through of 96 per cent to US buyers that pay the levies and then must either absorb them or raise selling prices. <\/p>\n

It is the US manufacturers and retailers who are having to decide whether they\u2019ll pass along their higher costs or deal with tighter margins.<\/p>\n

\u201cThe tariff functions not as a tax on foreign producers, but as a consumption tax on Americans,\u201d Kiel researchers Julian Hinz, Aaron Lohmann, Hendrik Mahlkow and Anna Vorwig wrote.<\/p>\n

\"\"Old order \u2018not coming back\u2019 as Trump overshadows World Economic Forum<\/p>\n

The research focuses on Brazil and India, whose exports were targeted with steep, broad US tariffs last year. After a 50 per cent duty took effect, Brazil\u2019s exporters \u201cdid not substantially reduce their dollar prices\u201d, it found. A similar pattern was seen with India, which first faced a 25 per cent tax that was raised weeks later to 50 per cent.<\/p>\n

Several reasons exist why exporters don\u2019t foot much of the bill, including their ability to redirect sales to other markets.<\/p>\n

\u201cThe adjustment occurs through reduced trade volumes, not price concessions,\u201d according to the Kiel paper. Based on shipment data covering 25 million transactions worth about $4 trillion, the Kiel study runs counter to the Trump administration\u2019s argument <\/a>that trading partners pay tariffs.<\/p>\n

\u201cThis claim has been central to the policy\u2019s justification: Tariffs are framed as a tool to extract concessions from trading partners while generating revenue for the US government \u2013 at no cost to American households\u201d, the Kiel researchers wrote. \u201cOur research shows the opposite: American importers and consumers bear nearly all the cost.\u201d<\/p>\n

That impact is also illustrated by US government consumer prices data. It shows furniture prices, which had been falling for 18 months before Trump came to office, were up 4 per cent in many categories in the year to December 2025, well above the US inflation rate of 2.7 per cent.<\/p>\n

\u201cWe definitely increased our prices multiple times,\u201d says Doug Townsend, the president of Magnussen Home Furnishings, a wholesale retailer based just outside High Point that employs about 150 people.<\/p>\n

That helps explain why, in the down days between Christmas and the new year, the White House <\/a>quietly slipped out the announcement that it was rowing back plans to double levies of up to 50 per cent on kitchen furniture. It followed similar moves earlier in the year on coffee, cocoa and other agricultural products, alongside exemptions for key electronic consumer products, such as mobile phones.<\/p>\n

Trump\u2019s promise to use tariffs to revive North Carolina\u2019s furniture industry formed part of a trade policy designed to, in the words of the US trade representative Jamieson Greer, \u201caccelerate re-industrialisation\u201d. Yet over the course of Trump\u2019s first year back in the White House, that grand ambition \u2013 which covered not just furniture but shipbuilding, autos and chip makers \u2013 has time and again been tempered by reality.<\/p>\n

The administration justified the decision not to increase tariffs on upholstered furniture and kitchen cabinets by citing \u201cproductive negotiations\u201d it was having with its trade partners.<\/p>\n

But analysts say the retreat also reflects intense industry lobbying, growing domestic political pressure over prices and a dawning realisation of the limitations of tariffs as a tool to bring back manufacturing to the US.<\/p>\n

\u201cThe administration has quietly been receptive to arguments that significant sectors should be exempted from tariffs, or arguments that the theory that tariffs will reshore production back to the US don\u2019t stand up,\u201d says former US trade representative Michael Froman, now president of the Council on Foreign Relations think tank.<\/p>\n

The idea that US manufacturing is going to come roaring back is \u201ca nice talking point for the administration and for people who believe in tariffs\u201d, adds furniture wholesaler Townsend. \u201cBut it just doesn\u2019t work that way.\u201d \u2013 Copyright The Financial Times Limited 2026\/Bloomberg <\/p>\n","protected":false},"excerpt":{"rendered":"Jerry Samet has lived in High Point, a small town in North Carolina that has styled itself as…\n","protected":false},"author":2,"featured_media":299958,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[174],"tags":[79,356,179,18,19,17,1411],"class_list":{"0":"post-299957","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-donald-trump","10":"tag-economy","11":"tag-eire","12":"tag-ie","13":"tag-ireland","14":"tag-us-tariffs"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/115945966396089533","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/299957","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=299957"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/299957\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/299958"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=299957"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=299957"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=299957"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}