Tariffs: Another Tax on the Working Class
What's actually happening: The Financial Times reports on new economic analysis affirming that US tariffs are predominantly paid by American importers, who then pass these costs directly to consumers. This isn't a fresh revelation for anyone familiar with basic trade economics, yet it perpetually resurfaces as if a surprising discovery within mainstream discourse. The current narrative, much like
the Smoot-Hawley Tariff Act of 1930 which helped plunge the world into the Great Depression, posits tariffs as a lever to protect domestic industries or punish foreign actors. However, historical precedents consistently show protectionist trade walls become just another invisible tax. A 2019 study from the National Bureau of Economic Research, for instance, found that US consumers and firms
absorbed nearly 100% of the costs of tariffs on steel and aluminum, totaling billions annually. This pattern of imposing import taxes under the guise of geopolitical leverage, while domestic households absorb the inflationary impact, is a classic double standard. While Washington lectures nations about maintaining open markets, it simultaneously implements policies that squeeze its own citizens,
disproportionately burdening lower-income households whose budgets are most sensitive to price increases on everyday goods. The economic fiction that foreign producers somehow absorb these costs allows politicians to claim toughness while quietly taxing their constituents. The Piaz argues this isn't just poor policy, it's a deliberate obfuscation of who truly benefits and who pays the price in