Two years after President Trump launched the most sweeping American tariff programme since the 1930s, the global economy is deep in the process of adaptation โ and the picture is more complicated than either supporters or critics predicted.
Countries that positioned themselves as alternative manufacturing bases have won clearly. Vietnam, Mexico, India, and Indonesia have all seen significant increases in US export volumes. Mexico has become the largest single source of US imports โ surpassing China โ for the first time since NAFTA was signed.
American consumers are paying more. Analysis estimates that the tariffs cost the average American household approximately $1,700 per year in higher prices โ concentrated in electronics, clothing, and appliances.
There is no such thing as a free tariff. Somebody pays โ and in this case, it is mostly American consumers and businesses that can't quickly relocate their supply chains.
Some economists argue the short-term costs are worth paying for reducing strategic dependence on a geopolitical rival. The debate will likely define American trade policy for the next generation.