Will Trump be the creator of another Switzerland !- God knows
Highlights – Have you ever imagined the magnitude of economic disruption a single policy can cause? A shocking report has emerged regarding Donald Trump’s tariff policy, which reveals that its impact has placed a burden on American companies comparable to the entire economy of a prosperous country.
……………………………………………………………………..
Can you imagine that trade tariffs alone have increased corporate spending so much that they’re larger than the entire economy of a wealthy country like Switzerland? Yes, according to a recent report by S&P Global, Donald Trump’s tariff policies in the US have imposed an additional burden of approximately $1.2 trillion on companies by 2025.
Significantly, Switzerland’s entire GDP is currently around $1.1 trillion. This means the additional burden on US companies is equivalent to the economy of an entire country. This comparison further illustrates how deep and widespread the impact of tariffs can be.
Increasing Corporate Expenses and Declining Earnings
S&P Global analyzed nearly 9,000 large public companies and found that corporate spending this year is projected to reach $53 trillion, far exceeding previous estimates. In addition to tariffs, wage increases, energy costs, and increased investment in sectors like AI are also contributing to this increase. These factors are leading to sharp declines in corporate profits. Major companies like Walmart, Amazon, and Costco have seen profits decline by approximately $907 billion.
Who is bearing its burden?
It has been told in the report that about two-thirds (about $592 billion) of the losses incurred by these companies are being recovered from customers. In the form of increased prices, that is, to compensate for the loss of companies, the general public is now buying expensive goods and doing it. The remaining one-third of the loss (about $315 billion) has been suffered by the companies internally, that is, by cutting their profits or by combining expenses.
Production decreased- Inflation increased
Due to the increase in inflation because of tarif, the actual production of companies has decreased, that is, they are now making less goods than before, but are increasing the prices. Due to this, consumers have to buy less goods at a higher price and it is not only about public companies. The report suggests that unregistered companies and private equity firms have also spent an additional $278 billion, bringing the total loss to $1.2 trillion.
The debate on the poor and the middle class, the biggest hit, has now intensified as to who is facing the burden of tariff. Federal Governor Christopher Waller, appointed during Trump’s time, believes that this has mostly affected the rich class. But on the other hand, many economists, such as Christopher Hodge, say that the lower and middle class have been hit hardest by it. The reason for this is that this class spends more of its income on goods, whose prices have increased due to tariffs such as furniture, electronics, clothes and household items.
