Free Trade

With Latest Trade War Gambit, Trump Administration Admits Americans Are Paying Tariff Costs

The White House says it will delay some new tariffs on Chinese imports until after the Christmas shopping season. But why do that if Americans aren't paying?


The White House on Tuesday said that some planned tariffs on consumer electronics and household goods would be postponed until December 15—a political maneuver intended to blunt the potential impact of those tariffs on the upcoming holiday shopping season.

What the White House didn't say in the official announcement—but what the action obviously indicates—is that Americans are clearly paying the costs associated with President Donald Trump's trade war.

In fact, Trump even said as much while speaking to reporters on Tuesday.

"We're doing this for the Christmas season," Trump said, according to The New York Times. "Just in case some of the tariffs would have an impact on U.S. customers."

Just in case! It's far from a definitive statement, but this seems like the first time since he launched the trade war last year that Trump has admitted someone other than China is paying for his tariffs. Pretty much everyone this side of Peter Navarro and Fox & Friends already knows that Americans are paying for the tariffs—tariffs are taxes, after all—but it's ever so slightly refreshing to see that the Trump administration might be awakening to economic reality.

But don't let your hopes get too high. Trump is still pushing forward with a plan to levy 10 percent tariffs on about $300 billion worth of annual imports from China before the end of the year, and there are already 25 percent tariffs on about $250 billion in annual imports.

The items that will be spared from the tariff list until December 15 include smartphones, video game consoles, speakers, computer monitors, and other consumer electronics, along with various items of clothing and footwear. Another list of items, including children's car seats, shipping containers, and Bibles will be permanently exempted from the planned tariffs, according to the Office of the United States Trade Representative.

"Today's announcement to delay imposing tariffs on Chinese imports of electronic goods, such as cellphones and laptops, is welcome news for American businesses and consumers," Neil Bradley, executive vice president of the U.S. Chamber of Commerce, said in a statement.

While Americans will be temporarily spared the estimated $1 billion tax increase on tech good imported from China, consumers and businesses will have to keep paying the president's other tariffs.

In June, Americans paid $6 billion in tariffs—one of the highest single-month totals, in nominal terms, in American history. Tariffs imposed by the Trump administration accounted for more than $3.4 billion of that overall total, according to a new analysis from Tariffs Hurt the Heartland, a coalition of business groups.

"It appears the administration understands that taxes on everyday products such as toys, clothes and electronics would be politically unpopular and hurt those who can least afford it," the group said in a statement released Tuesday. "Unfortunately, today's announcement doesn't address the vast majority of tariffs that are driving uncertainty, putting farmers out of business and causing small businesses to slow hiring. Instead of picking temporary winners and losers and holding the U.S. economy hostage, it is time to reach an agreement that finally puts an end to the trade war."

If Trump wants to give Americans a real Christmas present, he would set aside his foolish belief that China's behavior can be changed by imposing taxes on Americans. In the meantime, at least the president is starting to question the existence of Santa Claus.