According to a report from The Associated Press, President Donald Trump began imposing higher import taxes on dozens of countries Thursday just as the economic fallout of his monthslong tariff threats has begun to cause visible damage to the U.S. economy.
Just after midnight, goods from more than 60 countries and the European Union became subject to tariff rates of 10% or higher. Products from the EU, Japan and South Korea are taxed at 15%, while imports from Taiwan, Vietnam and Bangladesh are taxed at 20%. Trump also expects the EU, Japan and South Korea to invest hundreds of billions of dollars in the United States.
“I think the growth is going to be unprecedented,” Trump said Wednesday. He said the U.S. was “taking in hundreds of billions of dollars in tariffs,” but did not provide a specific figure for revenues because “we don’t even know what the final number is” regarding the rates.
Despite the uncertainty, the White House is confident that the onset of his tariffs will provide clarity about the path for the world’s largest economy. Now that companies understand the direction the U.S. is headed, the Republican administration believes it can ramp up new investments and jump-start hiring in ways that can rebalance America as a manufacturing power.
So far, however, there are signs of self-inflicted wounds to the U.S. as companies and consumers brace for the impact of the new taxes.
Risk of economic erosion
Hiring began to stall, inflationary pressures crept upward and home values in key markets started to decline after the initial tariff rollout in April, said John Silvia, CEO of Dynamic Economic Strategy.
“A less productive economy requires fewer workers,” Silvia said. “But there is more, the higher tariff prices lower workers’ real wages. The economy has become less productive, and firms cannot pay the same real wages as before. Actions have consequences.”
Many economists say the risk is that the American economy is steadily eroded.
Click here to read the full report from The Associated Press.
