Korean Media: The Effective Tariff Rate in the United States Has Reached the Highest Record in 91 Years!

On August 3, Korean media "Asia Economic" published an article stating that analysis by the Yale Budget Lab (TBL) showed that the average effective tariff rate in the United States rose from 2.5% at the beginning of the year to 18.3% in just seven months, reaching the highest level since 1934. This figure also reflects the impact of the Trump administration's "reciprocal tariffs" on trade partners.

Analysis data shows that the tariff policies introduced by President Trump this year will cause short-term price increases of 1.8% in the United States, equivalent to a reduction of $2,400 in household income.

Inflation rates in the clothing and textile industries are expected to be particularly high. 97% of clothing and shoe products in the United States rely on imports, with China, Vietnam, Indonesia, and India being the main exporters of these products. It is expected that the impact of tariffs will lead to a short-term increase in consumer prices for shoes and clothing by 40% and 38%, respectively. Long-term increases are expected to remain at 19% and 17%, respectively.

The tariffs imposed this year are expected to reduce South Korea's real GDP growth rate by 0.5 percentage points in 2025 and 2026, and by 0.4 percentage points each year thereafter. Calculated in 2024 dollars, this amounts to an annual GDP loss of $120 billion.

Foreign media pointed out, "President Trump portrays tariffs as taxes imposed on foreign countries, but in fact, American importers pay the tariffs and try to pass the impact on to consumers by raising prices." In fact, companies such as Walmart, Procter & Gamble, Ford, Best Buy, Adidas, Nike, Mattel, and Stanley Black & Decker have already raised prices in response to Trump's tariff measures.

Barry Appleton, co-director of the Center for International Law at New York Law School, said, "Import tariffs are a consumption tax, and thus have a particularly severe impact on low-income people. Prices of sports shoes, backpacks, and white goods will rise. Video game consoles will also become more expensive because these items are not made in the United States."

Appleton said, "Countries that yield to Trump's demands and avoid more suffering may be closer to the winners, but in the long run, no country, including the United States, can win. From many aspects, everyone is a loser."

Alan Wolf, a senior researcher at the Peterson Institute for International Economics (PIIE), said, "The biggest winner is Trump, and the biggest loser is the American consumer."

At the same time, US President Donald Trump suddenly fired the director of the Bureau of Labor Statistics on July 1st, claiming that the dismal employment data from the Department of Labor was "manipulated for political purposes." The revised data released by the Department of Labor showed that non-farm payroll jobs increased by only 73,000 in July, and decreased by 258,000 in May and June. This contradicts Trump's promise to revitalize American manufacturing through tariffs and signals a rapid economic contraction.

Original: https://www.toutiao.com/article/1839435665580099/

Statement: This article represents the views of the author.