Tariffs as Taxes at Home: How Trump-Era Trade Wars Still Shape Trade in 2026
trade-wars
Evidence shows Trump-era tariffs behaved like domestic taxes rather than foreign penalties — mostly passed through to US consumers, with little reshoring to show for it.
Trump-era tariffs functioned less like penalties on foreign exporters and more like taxes on American consumers: research finds pass-through rates of 80–100% to US buyers, only modest reshoring, and a small GDP drag with no real improvement in the structural trade deficit. Looking ahead, the piece warns tariffs risk becoming a permanent “leverage machine” in US trade strategy, posing ongoing risk to European sectors such as autos and green tech, while legal challenges to Section 232 continue to test the limits of presidential tariff authority.
Originally published on Substack, April 9, 2026.