President Donald Trump rails about tariffs and paints the United States as a victim of unfair trade practices, but experts in international commerce say the reality is a lot murkier: We impose tariffs on a diverse array of imports — even though some experts say American consumers would be better off without them.
“As tariffs fall and trade expands, households of all income levels benefit from lower-priced imports,” the United States International Trade Commission said in an extensive study published last year.
According to the Office of the U.S. Trade Representative, the average tariff is 2 percent on imports of “industrial goods,” a category that excludes agricultural products but includes shopping-cart staples like clothes and shoes as well as other consumer goods.
The current Harmonized Tariff Schedule, the official document that spells out which imports are subject to tariffs, clocks in at more than 3,700 pages. The United States imposes tariffs on imports for the same reasons other countries do: To protect certain domestic industries, or as a tit-for-tat retaliation against another nation. But while well intentioned, these barriers often fail to deliver, trade experts say.
“[The United States] still has relatively high tariffs for imported products like clothing and apparel, footwear and agricultural products,” said Chad Bown, a senior fellow at the Peterson Institute for International Economics. Quotas and other trade measures designed to protect the domestic sugar industry, for instance, are estimated to cost the U.S. government — that is, taxpayers — as much as $138 million through 2026.
Even some vehicles, a category in which the Trump administration has railed against other countries for imposing tariffs, are subject to tariffs under U.S. law.
“President Trump likes to complain about the auto tariff being only 2.5 percent, but the import tariff on pickup trucks is incredibly high at 25 percent,” Bown pointed out, referencing Trump’s reported desire to ban imports of German luxury cars.
Including all categories of imports to the United States, the average tariff is 1.5 percent, but since most goods coming into the country aren’t subject to any kind of import restrictions, the tariffs we do impose can be steep.
“The United States is far from pure,” said Laura Baughman, president of The Trade Partnership and Trade Partnership Worldwide. “We’ve got some pretty high peaks within it, and a lot are products that hit U.S. consumers directly,” she said.
More than 75 percent of imported clothes are subject to tariffs that run between roughly 16 and 19 percent (depending on the materials used in manufacturing). Tariffs on imported apparel and footwear can cost a family nearly $300 in additional costs per year, the U.S.I.T.C. said in its report, for an aggregate annual impact of $2.4 billion.
“Most consumers have no clue they’re paying this,” Baughman said.
And when tensions over tariffs on certain products or categories flare up, as they periodically have over the years, American consumers are the ones who wind up paying the price.
A 2012 study on the impact of tariffs imposed on Chinese tire imports between 2009 and 2011 found that the U.S.’s actions saved about 1,200 jobs, but did so at a cost of $1.1 billion — in other words, each job saved cost American consumers nearly $1 million.
A 21 percent tariff levied last year on Canadian lumber has added an average of $1,360 to the cost of each new home built, according to Bloomberg, while calculations from the Dallas Fed predict that the recent steel and aluminum tariffs will shave a quarter-percentage point off GDP growth.
A 21 percent tariff levied last year on Canadian lumber has added an average of $1,360 to the cost of each new home built.
Contrary to the Trump administration’s hard-line stance, the U.S.I.T.C. finds that rolling back protectionist policies like tariffs or import quotas benefits the domestic economy, since disrupting the global supply network that exists today creates inefficiencies that increases costs for producers, which are passed along to ordinary Americans in the form of higher prices or depressed wages.
Even bellicose trade rhetoric can have a chilling effect on global trade, said Meredith Crowley, an economics professor at Cambridge University.
“Even the threat of a tariff — that is never followed through and imposed — can reduce export activity,” she said. According to her research, uncertainty or inconsistency in trade policy discourages companies from entering foreign markets, and can prompt them to exit others.
“The risk of tariff hikes and the number of products that could be hit with tariff hikes is much much higher today,” Crowley said, which could magnify these consequences. “President Trump might be ‘weaponizing uncertainty,’" she said.