In recent months, the Trump administration has negotiated several trade deals that have seemingly benefited U.S. trading partners. This has given President Trump plenty of opportunities to showcase his trade negotiation skills.
But, as tariffs come into play, it appears that many Americans aren’t really thrilled about it. Polls indicate that his job approval rating has dropped to its lowest level of his second term, with only around 36% of those surveyed expressing satisfaction with his customs policy.
Although consumer confidence has seen some improvement, worries remain that tariffs on Trump-branded products could eventually lead to higher prices for consumers.
A conference committee’s survey revealed that consumer trust climbed from 95.2 in June to 97.2, with future expectations ranging between 69.9 and 74.4. Still, the committee cautioned that consumers are apprehensive about the outcomes of Trump’s ongoing trade conflict.
Furthermore, inflation has shown an increase, with the annual rise hitting 2.6% in June—up 2.5% as per the Commerce Department’s report on Personal Consumption Expenditure. Economists had expected this number to be around 2.5%.
While some businesses support the implications of these tariffs, many have faced immediate challenges within just a week of the tariffs being introduced.
“These aren’t your typical, voluntary trade agreements. They’re negotiated, signed, and ratified by countries,” explained Douglas Holtz-Arkhin, president of the Center Right American Action Forum, adding that these agreements are not likely to be durable. “Let’s see how it all unfolds,” he remarked.
With the August 1 deadline approaching, the pressure is on to finalize tariff deals with the U.S. or face possible “mutual tariffs” from the administration.
Trump recently criticized the European Union’s trade deal with Japan and announced a 15% tariff on both. Additionally, he revealed a similar agreement with South Korea on Wednesday, imposing that same 15% tariff on goods from there.
The president stated that countries without trade agreements could encounter tariffs of 15-20%, while Canada might face even steeper tariffs of 35%. This comes as Canada is one of the few key trading partners yet to finalize a deal.
The White House has continuously touted Trump’s trade accomplishments, challenging dire predictions from economists who suggest these new import taxes have had serious impacts.
“We’re on track to see President Trump revitalize the largest economy in world history and prove economic experts wrong,” said White House spokesperson Caroline Leavitt.
However, these assertions coincide with a decline in Trump’s approval rating, now at 40%, according to recent polls, with findings showing that over 44% of respondents have concerns about inflation.
Many Americans believe that Trump’s tariffs will lead to increased prices, though only 7% think they are ineffective.
“The average voter doesn’t really track trade agreements; they just notice changes in costs and what they pay. While these announcements are grand, they haven’t yet translated to anyone’s everyday life,” noted Bruce Melman, who served as the secretary of technology policy under former President George W. Bush.
Trump has adhered to the August 1 deadline after delaying it several times since he initially introduced “mutual tariffs” in April. A week later, those plans were placed on hold due to pressure from Wall Street and Republicans who sought to stabilize the faltering market.
According to Holtz-Arkhin, the White House might declare victory in this trade process, but the true measure will depend on its overall impact on the economy.
The effect on prices is expected to become clearer before the year ends, as companies may pass on tariff costs to consumers. “Significant moments will come during back-to-school and holiday shopping seasons. We should start feeling the impact in the next couple of quarters,” Holtz-Arkhin added.
Many of Trump’s trade agreements, including those with the Philippines and Indonesia, have provisions ensuring that U.S. exports won’t face tariffs, providing a more palatable aspect for Trump. Leavitt pointed out that the trade deal with the European Union will also grant American goods unprecedented access to their market.
Former special assistant to President Biden for manufacturing and industrial policy, Monica Gorman, remarked that opening markets for U.S. goods is promising, but the real outcome will hinge on private sector reactions.
“We need to monitor whether U.S. business investment continues. Although we observe growth in manufacturing and exports, corporate uncertainty has, so far, stunted that expansion,” Gorman commented.
Last-minute changes from the administration only add to this uncertainty; for instance, Trump recently announced a delay on tariffs concerning Mexico. He also stated that months of management claims that a deal with India was close would now result in a 25% tariff, alongside fines for purchasing military and energy supplies from Russia amid the Ukraine conflict.
