One Year of Tariff Policies: The U.S. Economy Faces Multiple Backlashes

Ask AI · Why do tariff policies make U.S. consumers bear 90% of the cost?

Reporter Li Zhiwei

Over the past year, the impact of U.S. tariff policies on prices of many goods has become increasingly evident. The photo shows April 5: U.S. residents shopping for goods inside a chain supermarket in Virginia. Photo by Reporter Li Zhiwei

Since the U.S. Supreme Court ruled that the federal government’s practice of imposing additional tariffs on products from multiple countries under the International Emergency Economic Powers Act is unlawful, the fight between U.S. importers and the government over tax refunds has continued. The U.S. government has announced that, under Section 122 of the 1974 Trade Act, it will impose a 15% tariff on most imported products worldwide, while it is also accelerating new trade investigations to seek new tariff tools.

A recent article from the Center for American Progress says that since April 2, 2025, when the U.S. government announced so-called “Liberation Day” tariffs, after one year, the government’s chaotic tariff measures and endless threats of tariffs have not only failed to achieve the stated goals, but instead have harmed the interests of U.S. consumers, businesses, and U.S. trading partners, brought enormous uncertainty to the U.S. economy, damaged the country’s international image, and drawn widespread opposition to related U.S. tariff policies around the world.

More than 60% of Americans are dissatisfied with tariff policies

Many research findings indicate that the damage high tariffs cause to the U.S. economy far exceeds the benefits. Many ordinary Americans have felt the shock of rising prices firsthand, and dissatisfaction with the additional tariffs has grown stronger. A study recently released by the Federal Reserve Bank of New York shows that of the additional costs generated by the U.S. government’s added tariffs in 2025, about 90% is borne by U.S. consumers and businesses. A report from the Kiel Institute for the World Economy in Germany says that the U.S. government’s added tariffs effectively amount to a consumption tax imposed on imported goods: 96% of the additional tariff costs are borne by U.S. importers and consumers, leading to a significant reduction in the types and quantities of goods consumers can choose from.

Based on a recent joint poll by ABC, The Washington Post, and Ipsos, 64% of Americans are dissatisfied with how the government is handling tariffs. A poll released in March by the Harris public opinion polling firm shows that about 70% of respondents say tariff policies require them to pay higher consumer costs; 72% of Americans believe tariff policies have a negative impact; and 67% of Americans say tariff policies are not the right approach to boosting the economy.

The impact of tariff policies is particularly palpable for many small and medium-sized businesses in the U.S. Kimberly Brandon and her husband run a small home renovation company in Florida. She said that tariffs have caused multiple kinds of building materials and supplies used for renovation to rise in cost: “Our company is too small to absorb the cost increases brought by the tariffs, so we have to raise our bids.” Brandon said, “As prices rise, many clients abandon their renovation plans, and our customer base and potential orders decline accordingly. We have no choice but to lay off most of our employees. I was already half-retired, but now I have to return to the company full-time.”

Philip Crawley, in California, runs a small business that mainly imports laser equipment. “Last year, our company paid tens of thousands of dollars in tariffs. Tariffs led customers to delay purchases, slowing our business, and we had to cut salaries,” Crawley said. “As a business owner, my income has fallen, and we’ve also postponed plans to hire new employees.”

Nearly 100k manufacturing jobs cut within one year

One goal the U.S. government proposes to carry out tariff policies is to bring manufacturing back, saying it will force more factories to locate in the United States and increase fiscal revenue. However, reality is far from the ideal. According to the U.S. Wall Street Journal, U.S. manufacturing has shrunk further due to tariff policies, with employment continuing to decline. Official data show that in the eight months after the government announced the so-called “Liberation Day” tariff plan, U.S. domestic manufacturers were laying off workers every month, worsening a downward trend in which more than 200k jobs have already disappeared since 2023. For decades, the offshoring of U.S. manufacturing and the hollowing out of manufacturing have been important reasons for the continued contraction of the manufacturing sector. At the same time, affected by tariff policies, many companies in the industry have seen soaring costs of purchasing raw materials overseas, forcing them to raise prices or causing disruption to their production and supply chain networks.

Allen Engineering in Arkansas mainly produces concrete paving and finishing equipment. Its executive Jay Allen said that affected by tariff policies, the company was operating at a loss in 2025, and the number of employees has fallen from 205 at its peak to 140: “The unintended consequences of tariff policies are harming U.S. manufacturing, and working-class people are being squeezed as a result.” Howard Woltz, the head of Insteel Industries in North Carolina, said that affected by tariff policies, the company is finding it increasingly difficult to obtain the metal it needs from U.S. suppliers. “Because of shortages of domestic raw materials, our business growth could be affected.”

U.S. economist and former chief economist of the World Bank Anne Krueger noted that tariff policies bring chaos and uncertainty. U.S. producers cannot predict how much import competition they will face and the prices of competing goods. Companies that rely on imports do not know how much they will ultimately have to pay for it, and export-oriented companies cannot gauge how competitive they can remain if higher input costs will arise. Many exporters face higher production costs and retaliatory tariffs from other countries, which could reduce their global business. Many companies even cannot determine which tariff rates truly apply to them. The Associated Press reports that over the past 12 months, the number of manufacturing jobs in the U.S. has fallen by 98k. U.S. companies that are currently bearing the costs of tariffs have sued the government over tax refund issues, with the claimed amount exceeding $130 billion.

A sharp increase in uncertainty for business investment

Lewiston Township in northern New York is near the U.S.-Canada border. In the past, many Canadians often crossed the border to buy necessities such as milk, bread, and gasoline in the United States because of differences in exchange rates and sales taxes. Now everything has changed. Many people are boycotting U.S. goods due to tariff issues and refusing to spend money in border towns like Lewiston Township, and many border towns in the U.S. have seen business decline significantly. A 41-year-old bakery shop owner, Amy Lockren, in Lewiston Township, complained: “The sales of all the stores on this street have dropped sharply. My bakery’s revenue is down 30%, and we have to cut spending on things in the shop and at home. Life is really difficult.”

A study released recently by the Brookings Institution, conducted by Pablo Fajardo-Baum, an economist at the University of California, Los Angeles, and Amit Kandelwal, an economist at Yale University, found that any positive effects of U.S. tariff policies on the U.S. economy are negligible. There is no evidence that tariff policies increase U.S. manufacturing jobs or reduce the U.S. overall trade deficit. Over the past year, large-scale tariff increases have made it more difficult for production that is competitive within the United States to take place domestically, especially in industries that rely on imported parts and raw materials.

Bernd Lange, chair of the European Parliament’s Committee on International Trade, said in response that the U.S. government has created a “pure tariff mess.” In the current situation, the EU and other U.S. trading partners are facing a series of unresolved issues and a growing amount of uncertainty. Joseph Stainberg, an economist at the University of Toronto, said that uncertainty in U.S. trade policy makes businesses hesitant to expand investment on a whim. U.S. manufacturing has not recovered, and even investment in factories has declined.

An article from the Center for American Progress argues that U.S. tariff policies have not achieved any of their set goals and instead, at an astonishingly high cost, have demonstrated massive destructive effects. Tariff policies have suffered threefold failure: the goods trade deficit has hit a new high, manufacturing continues to shrink, and they have failed to bring prosperity to working-class Americans. In the medium and long term, the United States’ international standing and overseas strategic interests will both be harmed. The article asks: so far, aside from making U.S. consumers bear higher prices, leading to the loss of blue-collar jobs, damaging overseas trust, and driving a surge in the number of small businesses going bankrupt, what benefits has the U.S. government’s tariff policy produced? The answer is: almost none.

(Report from Washington, April 6)

The People’s Daily (April 07, 2026, p. 17)