Key points
- This round of tariffs might be 50 times more painful: New York Times
- 25pc tariff on vehicles will increase their prices
- Tariffs will hurt the most vulnerable people: UN
WASHINGTON: Trump’s tariffs are set to fundamentally alter people’s lives in much more fundamental ways. According to the New York Times, this round of tariffs may be 50 times as painful as the ones Trump instituted in his first term.
It added that tariffs are costly not just because they raise prices but because they force you to make different decisions that will extract a different kind of cost from you over time, the newspaper reported.
Trump has imposed 25 per cent tariff on vehicles, which is expected to raise their prices by roughly $4,000. Many families in the US will probably decide not to buy a second car.
And it’s not just cars. These are across-the-board tariffs, so they will distort virtually every purchase you make. In each case you’ll have to stop your baked-in calculations, recalibrate and find a way to make do — perhaps substituting frozen vegetables for fresh vegetables, a less effective medication for a higher-priced import, or corn syrup for sugar. And in each case, you are worse off, according to New York Times.
People to rethink
Just as tariffs lead you to buy less desirable alternatives, they lead businesses to channel labour and capital into less desirable — that is, less productive — activities.
The tariffs announced on Wednesday are roughly 10 times as high as those of most other industrialized countries, according to the newspaper.
Trump’s latest tariffs will lead people to rethink not only whether to replace their washing machines but also their dryers, refrigerators, stoves, groceries, clothes, cars and even everyday essentials.
AFP reported that increased global trade tariffs will hurt the most vulnerable and poor people, the UN’s trade and development agency said Friday.
The ensuing trade turbulence “hurts the vulnerable and the poor”, said UNCTAD Secretary-General Rebeca Grynspan in a statement.
“Trade must not become another source of instability. It should serve development and global growth,” Grynspan said.
