One Year After Tariff Policy Implementation, the U.S. Economy Faces Multiple Backlashes (In-Depth Analysis)

(Original title: Research shows that about 90% of the additional costs from the U.S. imposing new tariffs in 2025 are borne by U.S. consumers and businesses One year of tariff policy: the U.S. economy suffers multiple backlashes (in-depth observation))

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

A recent article by the Center for American Progress says that, since the U.S. government announced so-called “Liberation Day” tariffs on April 2, 2025, one year has passed. The administration’s chaotic tariff measures and endless threats of additional tariffs have not only failed to achieve the intended goals, but instead have damaged the interests of U.S. consumers, businesses, and America’s trade partners, bringing enormous uncertainty to the U.S. economy, harming America’s international image, and prompting widespread opposition from people around the world to the U.S. tariff policy.

More than 60% of Americans express dissatisfaction with tariff policy

Many studies show that the damage high tariffs do to the U.S. economy far exceeds the benefits. Many ordinary Americans have felt firsthand the impact of rising prices, and dissatisfaction with the additional tariffs has grown. A study recently released by the Federal Reserve Bank of New York found that among the additional costs resulting from the U.S. government’s 2025 tariffs, 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 additional tariffs are, in practice, a consumption tax on imported goods. Of the additional tariffs, 96% is borne by U.S. importers and consumers, leading to a large reduction in the range and quantity of goods available to consumers.

According to a recent poll jointly conducted by ABC, The Washington Post, and Ipsos, 64% of Americans are dissatisfied with the way the government has handled the tariff issue. A poll released in March by the Harris public opinion survey firm found that about 70% of people said that tariff policy forces them to pay higher consumer costs; 72% of Americans believe tariff policy has a negative impact; and 67% of Americans say tariff policy is not the right solution to boost the economy.

The impact of tariff policy is especially evident to 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 raised the cost of various construction materials and supplies used in renovations. “Our company is too small to absorb the increased costs caused by tariffs, so we have to raise our quotes.” Brandon said, “As prices go up, many customers abandon their renovation plans. Our customer base and potential orders then decline. We have to lay off most of our employees. I was already halfway retired, but now I have to go back 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 caused customers to delay purchases, and our business slowed down, so we had to cut wages,” Crawley said. “As a business owner, my income has fallen, and I’ve also had to put off plans to hire new employees.”

A year cuts nearly 100,000 manufacturing jobs

One goal proposed by the U.S. government for implementing tariff policy is to bring manufacturing back, claiming it will force more factories to be located in the United States and increase fiscal revenue. However, reality is far from ideal. According to the Wall Street Journal, weighed down by tariff policy, U.S. manufacturing has continued to shrink, with employment numbers steadily declining. Official data show that in the eight months after the government announced its so-called “Liberation Day” tariff plan, every month U.S. domestic manufacturers were laying off workers, worsening the downward trend in which more than 200,000 jobs had already been lost since 2023. For decades, the offshoring of U.S. manufacturing and the “hollowing out” of manufacturing have been major reasons for manufacturing’s ongoing decline. At the same time, due to tariff policy, many companies in the industry saw soaring costs for purchasing raw materials from overseas, forcing them to raise prices or having their production and supply-chain network disrupted.

Allen Engineering Company in Arkansas mainly produces concrete paving and finishing equipment. Company executive Jay Allen said that due to tariff policy, 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 caused by tariff policy are harming American manufacturing, and the working class is being squeezed as a result.” Howard Woltz, head of Insteel Industries in North Carolina, said that due to tariff policy, the company is increasingly finding it difficult to obtain the metal it needs from U.S. suppliers. “Because domestic raw materials are in short supply, our performance growth could be affected.”

U.S. economist and former chief economist at the World Bank, Anne Krueger, said tariff policy has brought disorder 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, and export-oriented companies cannot measure how much higher input costs will keep them competitive. Many exporters face higher production costs and retaliatory tariffs from other countries, which could shrink their global business. Many companies even cannot determine which tariff rates truly apply to them. The Associated Press reported that over the past 12 months, U.S. manufacturing jobs have fallen by 98,000. U.S. companies currently bearing the costs of tariffs have sued the government over the tax refund issue, with claimed damages exceeding $130 billion.

Greatly increases uncertainty for business investment

Lewis town in northern New York is near the U.S.-Canada border. In the past, many Canadians often crossed the border to buy essentials like milk, bread, and gasoline in the U.S., partly because of differences in exchange rates and sales tax. Now everything has changed. Many people have boycotted American goods over tariff issues and refuse to spend money in border towns like Lewis town, and business in many U.S. border towns has been much worse. The 41-year-old owner of a bakery in Lewis town, Amy Lockren, complained: “Sales at all the shops on this street have dropped sharply. My bakery’s income is down 30%, and I’ve had to cut spending on the store and at home. Life is really hard.”

A study released recently by the Brookings Institution, conducted by University of California, Los Angeles economist Pablo Fajerbaum and Yale University economist Amit Khandelwal, found that U.S. tariff policy has only negligible positive effects on the U.S. economy, with no evidence that tariff policy has increased U.S. manufacturing employment or reduced the U.S.’s overall trade deficit. Over the past year, large-scale tariff increases have made it more difficult for competitive production in the U.S. domestic market to operate there—especially for industries that rely on imported components and raw materials.

Bernd Lange, chair of the European Parliament’s Committee on International Trade, said that the U.S. government has created “pure tariff chaos.” Under the current situation, the EU and other U.S. trade partners face a series of unresolved issues and rapidly increasing uncertainty. Joseph Stainberg, an economist at the University of Toronto, said that uncertainty in U.S. trade policy makes companies hesitant to expand investment. U.S. manufacturing has not recovered, and investment in factories has even declined.

An article by the Center for American Progress argues that U.S. tariff policy has failed to achieve any of its set goals and instead has demonstrated its disruptive power at an astonishingly high cost. Tariff policy has suffered three major failures: the goods trade deficit has hit a new high, manufacturing continues to shrink, and it has failed to bring prosperity to U.S. working-class households. In the medium and long term, America’s international standing and overseas strategic interests will also be harmed. The article asks: so far, apart from forcing U.S. consumers to bear higher prices, leading to the loss of blue-collar jobs, breaking trust overseas, and triggering a surge in small business bankruptcies, what benefits has the U.S. government’s tariff policy actually produced? The answer is: almost none.