A new analysis from J.P. Morgan shows Trump's trade war with China is hitting families in the wallet.
The firm looked at the costs to families from Trump's existing tariffs and added in the new hikes expected to go into effect in September and December, determining the average household will pay an additional $1,000 per year.
The new round of tariffs demanded by Trump impacts different types of products than previous tariffs, meaning, "consumer impact should be larger in the latest round," the analysis states.
Trump is handing out billions to bail out farmers getting crushed by the ongoing trade war with China, but "there is no simple way to compensate [the] consumer," Dubravko Lakos-Bujas, head of U.S. equity strategy at J.P. Morgan, said.
Even Senate Majority Leader Mitch McConnell, one of Trump's most loyal sycophants in Congress, admitted Trump's trade wars are nothing more than taxes on American families.
Tariffs are "a tax increase, frankly, on working-class people," McConnell said in June. "It drives up the cost of goods that you would be purchasing at Walmart and other places."
Trump regularly insists that China pays the tariffs, but that's just not the case. Companies that purchase good from China pay the tariff, and then have the option of either absorbing the cost or passing the cost along to consumers. And many pass at least some of the costs on to families shopping at Walmart, Target, Sears, or other stores.
"Tariffs are taxes paid by American families and American businesses," Tom Donohue, president of the Chamber of Commerce, said in January.
Previous studies on the impact of Trump's trade war show a ballooning cost for families throughout the country. Washing machines are already more expensive, costing about $100 more each, thanks to Trump's previous tariffs on steel. Both the footwear industry and toy industry separately warned that escalating the trade war with China will make shoes and toys more expensive.
In July, economists said wage growth for workers in America "remains tepid." Trump's trade war is just adding more expenses, even as wages for most workers are stagnating.
Published with permission of The American Independent Foundation.