Highlights – The tariffs imposed by Donald Trump are now proving to be a huge loss for the United States. Former IMF chief Gita Gopinath stated that this policy is burdening domestic consumers and companies, with little or no economic benefit.
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Trump tariff backfire: US President Donald Trump’s policy of imposing massive tariffs on global trade is now proving to be a major backfire for the United States itself. While Trump imposed high tariffs of 25% on countries like China and up to 50% on allies like India and Brazil, former Chief Economist of the International Monetary Fund (IMF) Gita Gopinath has now joined the list of critics of this move. Gita Gopinath, a professor of economics at Harvard University, has made the shocking claim that even after six months, Trump’s tariffs have not had any significant positive impact on the American economy. In fact, the revenue generated by the tariffs has been almost entirely collected from the American public and companies, meaning it has been a negative scorecard for the United States.
The Negative Impact of the Trade War on the US Economy
Donald Trump’s aggressive tariff policy led to a trade war-like situation globally. In India’s case, tariffs were doubled from 25% to 50%, citing Russian oil purchases, and some Indian medicines were even slapped with 100%. But what did the US gain from all this? Gita Gopinath, in a post on the social media platform X, clarified that while the tariffs increased revenue, this money was almost entirely collected from American companies and partially offset by American consumers. She wrote, “Overall, Trump’s tariffs proved to be a tax on them.” This simply means that in an attempt to burden foreign companies or countries, American citizens and businesses ultimately paid the price.
No Improvement in Domestic Manufacturing and Trade Balance
The Trump administration stated the primary purpose of imposing these tariffs was to promote domestic manufacturing and improve the trade balance. But according to Gita Gopinath, these objectives were not achieved. The former IMF Chief Economist criticized that neither the trade balance improved nor there was any sign of a positive impact on the US manufacturing sector. She stated categorically that this was a direct negative scorecard for the US economy. The expected economic benefits from the tariffs were minimal or nonexistent.
Tariffs have increased inflation
Another major negative impact on the US economy due to tariffs has been inflation. Gita Gopinath stated that since the tariffs were implemented, the country has seen a slight increase in inflation. Prices of household appliances, furniture, and coffee have particularly increased. Not only Gita Gopinath, but many leading economists around the world have criticized Trump’s move, calling it contrary to the principles of free trade and calling it a bad policy for America itself. Instead of making American products cheaper by increasing the cost of foreign imports, this policy of imposing tariffs has instead cost American consumers and businesses dearly.
