The Trump Tariffs Impact — The Big Picture Version

By: Isla Hildebrand

Over the entirety of 2025, the capital of the United States, Washington, D.C., has found itself amid a trade war with what seems to be the rest of the world. President Donald Trump, who was sworn into office on January 20th of this year, shaped his campaign around promises to “tariff and tax foreign countries to enrich our citizens.” In simpler terms, he wants Americans to buy American-made goods and reduce their reliance on imported foreign products.

As of today, the new taxes on imported goods have been imposed on 70 different countries from all across the globe, expanding to nearly every continent. These countries include military allies of America, such as Canada, Mexico, and nearly all of Europe. No sector of an economy is safe, with these taxes covering everything from electronics to agriculture to construction and many more areas. So those new headphones that you couldn't wait to buy for this upcoming school year? Go check on the recent price and see how much it's risen.

The original intent behind these tariffs was to protect the American job system and improve the manufacturing reputation of the United States. However, instead, the entire global economy has been thrown into a total whirlwind of chaos. 50% tariffs have been placed on metal imports, and there is now a threat to raise medicine taxes to over 200%.

For my chronically online people, that one TikTok sound that goes, "What on earth is going on in the House of Commons tonight," just about sums up how the average American feels trying to understand the economic cycle right now. But in today's article, we're going to make it so this entire situation doesn't feel like you're stuck in a riptide. We're breaking down the Trump tariffs so that they make sense to the average individual. Once again, economics is so much more than a simple graph or math equation, and these tariffs are more than just another news headline.

By the end of today, we hope you feel less like the "What on earth is going on in the House of Commons tonight" sound and more like the Alexander Hamilton of economics. As always, the global economy impacts everyone on Earth, so it's vital to understand what these tariffs mean for your future and the future of the global market.

Let's get started!

What Even Is a Tariff?

A tariff is something implemented by a government that acts as a tax on any sort of imported product. It makes the price of purchasing more expensive, but it's done with the intent to strengthen a domestic business, much like President Trump's original intent. However, a tariff war, much like what's going on right now, emerges whenever one country feels like the tariffs placed against them are unfair, and they turn to retaliation.

At the end of the day, tariffs are armor for local businesses, but weapons for foreign countries.

The Timeline of Events

January 20th – Like we stated in a previous paragraph, this was the day President Trump took the oath of office. His presidential oath included swearing his allegiance to the Constitution and doing his best to protect and serve it.

We also briefly touched on how he planned to tax foreign imports, so that there was a greater focus on American-made goods. His first real statement was his plan to place a 25% tax on Canadian and Mexican goods, closely followed by those of China.

January 26th – Trump threatened tariffs on Colombian imports following a dispute sparked by Colombian President Gustavo Petro criticizing the way America went about treating immigrants during the deportation process. While tensions eased after Colombia agreed to house these immigrants, the original plan was one of retaliation with the same 25% tax, this time on American goods, by Colombia.

The entire month of February - President Trump goes back and forth with his plans for taxing Canadian, Mexican, and Chinese goods, ranging from 10-25% increases. While tariffs on Canada and Mexico were temporarily paused, China experienced a 10% increase. Discussions also arose about raising taxes on steel and aluminum.

Trump introduced the idea of “reciprocal tariffs,” meaning if another country taxes the U.S., America would match that tax equally. Economists voiced strong concerns that this could lead to a severe recession, but the administration pressed ahead.

March – Debates over tariffs on lumber emerged, tariffs on Canada and Mexico took effect, and China responded by taxing American agricultural goods. Threats against European alcohol imports and taxes on gasoline and automobiles were also raised.

Due to retaliation from Canada and Mexico, Trump temporarily delayed some tariffs. The entire month is one big ping-pong match between America and the rest of the world, and we all got whiplash from watching.

The entire month of April - These reciprocal tariffs that President Trump promised are officially initiated, taxes on Asian goods rise, and America's relationship with Canada and Mexico improves due to border immigration practices.

The EU also then voted to retaliate against America through even more taxation. Riveting, I know. President Trump then also began to relax his tariffs on automobiles on companies that build in America but import tools from other countries.

To sum up April, it's simply one big back-and-forth match with China, seeing who can raise taxes more without sending their own country into a recession.

May – Tariff reductions for automobile companies took effect. Trump threatened to impose a 100% tax on imported movies following disputes with the American film industry. A deal between America and Britain was reached to lower tariffs between the two, but the EU as a whole publishes a list of retaliatory taxes that would go into effect should President Trump not put an end to this trade war.

A truce is, in fact, reached with China to reduce tax rates by over 100%, but a new threat to Apple technology is then made. President Trump basically says that if the electronics aren't made in America, there would be a 25% tax on them. Along with this, President Trump then takes to Twitter to speak about how any conversations with the EU aren't productive, but he's delaying the 50% tariff until July 9th, regardless.

June 3rd – An official order was signed raising tariffs on metals such as aluminum and steel to 50%.

The entire month of July - June was basically the calm before the storm, and even then, it wasn't fully calm. There are new taxes instituted on Vietnamese goods. Trump says that anyone associated with "anti-American policies" will face even higher taxes, and more taxes will be pushed onto Canada. Lots of agreements are reached at this time; however, America has reached agreements with Indonesia, the EU, and South Korea.

Even more threats roll in for countries that don't reach an agreement with America, and all around the world, tariffs are raised continually. President Trump comes out with another statement saying that more tariffs would be specifically implemented starting August 1st, and they would be drastic raises.

August 1st - The tariffs are postponed for a few days so that any countries are able to brace and adjust to what this could bring.

August 6/7th - These tariffs are for countries that didn't reach an agreement with President Trump. The tariffs are officially put into motion, and the price of any sort of everyday products Americans use is raised quickly. In a study done by Yale Labs, it was discovered that as of now, these tariffs will cost a household $2,400 more on average per month.

The Bigger Picture

Okay, that was a lot. The overall picture is just the idea that Trump has been engaged in an ongoing trade war with what feels like the rest of the globe. While many benefits have emerged from these tariffs, such as more diversity within economies to counteract the reliance upon one business, the investment in technological innovation to encourage efficiency, and more communication surrounding trade, the negative impacts seem to be a bit more prominent.

The drastic rise in prices, the anger from other countries, and the overall instability these tariffs have caused only continue to demonstrate the importance of understanding the world of economics. Keeping an eye on the ongoing trade war allows for this timeline to expand, but now having the background knowledge necessary for comprehension, you're much better off for the future.

So, Who Actually Benefits From This?

With all of the negative effects emerging from these tariffs, it can get cloudy and difficult to see who actually gets something out of increased taxes. For an average individual, the raised prices and an unknown future for the economy can make it very difficult to see any benefit from tariffs. But there are a few groups that emerge victorious from the battlefield, and for many people across America, this makes them upset.

For any sort of industry or company that had a genuine rival that was in foreign waters, these tariffs have been great news for them. The rise in taxes on such goods now means that they are receiving much more work in America, as the regular individual doesn't want to pay 50% more for construction materials. Demand is skyrocketing for certain products, meaning that employment rates are up and growth within certain industry sectors is booming. Gas companies like Chevron, defense companies like Boeing, and automobile companies like Ford are all thriving with these new tariffs, as they are entirely domestic and have no need to import distant products.

Another group that has been succeeding amid the tariff war is the billionaires of America. Anyone online understands that this is one of the main fuels to the fire that is the anger of the average individual. For billionaires, they have an incredible amount of flexibility within their companies, which allows them to plan and shift according to current world events. Along with this, the immense amount of money billionaires have allows them to corrupt politicians or alter the outcome of an event to benefit themselves. A lot of people view billionaires as deceitful and see their powerful influence as a symbol of inequality. The lack of taxation that also occurs through inherited wealth among billionaires now means that there will be underfunding for education programs and healthcare.

Regardless, billionaires have been incredibly successful amid this ongoing taxation crisis through their ability to control industries through their shareholdings in companies. If their own company is in an industry that's thriving, they're then able to start investing more time, money, and influence into promoting their cause. Their overall income skyrockets, and in the end, their success rates translate to wealth gain.

For the average everyday American, these tariffs have been nothing short of frustrating, draining, and overall humiliating. It's rather difficult to watch certain groups of people or industries thrive while all of a sudden, you can't make ends meet.

The continued imbalance of equality, power, and wealth has been an issue for centuries and will continue to be one for many years to come. For some to bear the full force of inflation while others ride the wave of success in it, it leads to a lack of trust and respect for those with power. To know who truly wins at the end of the day is important knowledge involving economics; it allows for clarity when power is involved.

The Future As Of Now

Like we said earlier, this entire trade war has been one big round ping-pong, and the whiplash from all sides is startling. Since it's still ongoing, predicting the future of the global economy is difficult, but it's important to understand potential outcomes and the impacts they could have on the following years of the world.

Should all countries involved reach agreements with President Trump, we can expect tax rates to decrease. As we noticed previously, when agreements were reached with places such as Indonesia and South Korea, the tariffs on both sides drastically decreased, leveling out the economies slightly. Stabilization would be an immediate effect of this, as companies all across the world would be able to ease back into production and trade.

As blissful as that idea may seem, it's pretty unlikely that all parties will reach proper agreements. This means the other side of the outcomes includes a greater spike in tariffs and taxation while still not allowing proper imports. If this is to happen, the potential for recessions and troughs becomes more and more likely, and the price of living in America would only continue to rise.

Economists predict that prices will stay high even if the trade war ends. Stability doesn't return overnight, and the cost of production won't be cheap. Overall, it's commonly thought that this tariff war will continue for some time, making for an even longer list of pros vs cons. That being said, it's also recognized by economists that they need to approach this idea from a political standpoint. If diplomacy and cooperation ensue, then agreements can emerge, and tariffs slowly peel away. Should the trade war continue, however, the effects could become irreversible for all parties involved.

Regardless of the future of these tariffs and their impact, there will continue to be both pros and cons emerging as a result. There's the opportunity for growth and success, and then there's also the concern for recessions and even higher taxes. Understanding who benefits and who loses is essential in understanding how the future of your finances could work.

Let's Wrap It Up

The trade wars have, and will continue to be, an incredibly long and lengthy process. From understanding the events that got us here today to understanding who ultimately wins in the long run, to understanding what the potential outcomes for the future could be, it's so important to realize how the global economy works.

President Trump went into this with the intent to better the American economy through a better focus on domestic shipments and increasing the stability of the national market for the long term. While this war won't continue for eternity, understanding how your future could look automatically translates into being better prepared for any array of outcomes.

As always, continue to ask questions, remain curious about the world around you, and we'll see you again for our next article!

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Understanding Tariffs and Their Impact on Your Wallet

The world of tariffs can feel overwhelming. But understanding them is crucial for your future. The phrase “tariff and tax foreign countries to enrich our citizens” is more than just a political slogan; it’s a reflection of how interconnected our economies are.

By grasping these concepts, you can navigate the complexities of economics with confidence. So, let’s keep learning together!