Ancestors

Written by Andrew Lokenauth on 2025-02-03 at 03:15

President Trump says the pain from tariffs "will be worth the price."

But what does it mean for you?

I spent the evening analyzing it.

Here’s what you need to know:

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Written by Andrew Lokenauth on 2025-02-03 at 03:16

1/Because of new tariffs, the average American family could pay about $1,245 more per year for everyday items.

This includes:

• Costlier furniture and home goods

• More expensive clothes and shoes

• Higher prices for cars and car parts

• Pricier groceries, especially fruits and vegetables

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Written by Andrew Lokenauth on 2025-02-03 at 03:16

2/ Tariffs Will Affect Everyday Life:

1. Cars:

• Vehicle prices could rise

• Auto parts costs would increase, affecting repair and maintenance

2. Food:

• Furniture imports from China could see 10-25% increases

• Electronics and household appliances would become more expensive

• Clothing and footwear prices could rise

3. Consumer Goods:

• Avocado prices could increase 90%

• Mexican beer brands might see price hikes

• Canadian agricultural including frozen foods, would become more expensive

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Written by Andrew Lokenauth on 2025-02-03 at 03:16

3/ The implementation of broad tariffs could have significant inflationary and economic effects:

• Core prices could increase by 0.7%

• Inflation might jump from 2.9% to as high as 4%

• Energy costs could rise due to tariffs on Canadian oil and gas imports

• Potential reduction in U.S. GDP by 0.4%

• Disruption of established supply chains

• Decreased consumer spending power

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Written by Andrew Lokenauth on 2025-02-03 at 03:17

4a/ Pros of Tariffs

Supporters Say:

• Protect Local Jobs: Tariffs can help American companies by making imported goods more expensive.

• Boost Domestic Production: Higher import prices may encourage companies to produce more in the U.S.

• National Security: Some argue that tariffs can protect industries critical for national defense.

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Written by Andrew Lokenauth on 2025-02-03 at 03:17

4b/ Cons of Tariffs

Critics Say:

• Higher Prices for Consumers: Most of the cost is passed to everyday shoppers.

• Inefficient Industries: Protected industries may become lazy without the pressure to be competitive.

• Risk of Trade Wars: Other countries may retaliate, leading to a global slowdown.

• Economic Uncertainty: Sudden changes in tariffs can hurt business investments and overall growth.

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Written by Andrew Lokenauth on 2025-02-03 at 03:17

5/ How Do Tariffs Work?

When a product is imported, the importer pays the tariff at the border.

For example, if a toy is worth $10 and has a 20% tariff, the importer pays an extra $2.

Often, the importer adds this cost to the toy's price when selling it in the U.S., so you may pay $12 instead of $10.

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Written by Andrew Lokenauth on 2025-02-03 at 03:18

Tariffs have a ripple effect:

1. Rising Prices: As importers pay more, prices for consumers go up.

2. Business Decisions: Companies may change where they buy or make their products.

3. Trade Flows: Other countries may put tariffs on U.S. goods in retaliation.

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Written by Andrew Lokenauth on 2025-02-03 at 03:18

6/ Who Really Pays & How They Affect You:

1. Importers absorb the cost: This eats into their profits and can potentially put some out of business.

2. Suppliers are forced to lower prices: If importers have significant market power, they might pressure their suppliers to reduce prices.

3. Costs are passed to consumers: Often, the most likely outcome is that consumers end up paying higher prices for goods.

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Toot

Written by Andrew Lokenauth on 2025-02-03 at 03:18

7/ The Real Cost of Tariffs:

Contrary to some claims, foreign countries do not directly pay tariffs—rather, the U.S. companies importing the goods are responsible for paying tariffs to the U.S. government.

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Descendants

Written by Andrew Lokenauth on 2025-02-03 at 03:19

Do you think tariffs help protect American jobs or hurt consumers more?

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