Recently, Donald Trump has been imposing tariffs on countries we often trade with to obtain most of our resources. These tariffs have caused the prices of imported goods to go up exponentially and the effects are starting to harm our economy in the United States.
A tariff is a tax that is imposed on imported goods. Tariffs are supposed to be used to help control the price of goods and prevent foreign markets from competing in other countries. Trump, however, has been using them on countries because he has different beliefs from them, and in doing it, it caused them to retaliate. He imposed large tariffs on China and Canada, two of our biggest trade partners, causing them to retaliate and raise their prices on everything. This has caused the prices of nearly everything in America to go up.
The tariffs shifting the economy have caused problems for many companies, and it is expected to only get worse from here. Even major companies like Ford aren’t safe from these tariffs, Ford said in the first quarter of sales that they lost out on two-thirds of their regular income. They normally make around 1.4 billion in a quarter of the year, but after the tariffs, they made 473 million dollars. Even though they still made a lot of money, this shows how the tariffs have disrupted the cash flow for many companies, which in turn affects smaller businesses and companies that supply goods, parts, and services to them.
The car industry is not the only industry affected by these tariffs. Grocery stores, restaurants, and electronics are just some types of industries that have been experiencing problems. Rite Aid is one company that the tariffs have hurt. They haven’t wholly failed due to tariffs, but that was the final nail in the coffin for them. They filed for bankruptcy in 2024 and closed down a lot of their stores to be able to continue business, and they were doing good for a couple of months after that, but they had to file for bankruptcy again. Now they are looking to close more stores so they can continue to operate. The price of many common goods has gone up because we get them from countries Trump has put tariffs. The cost of furniture, electronics, and food imports has all gone up drastically. Some major companies that have been affected by this are Tesla, Apple, Adidas, Stanley Black & Decker, and many more.
As the prices continue to rise, saving money and starting an emergency fund to fall back on is recommended by economists. Dave Ramsey, a finance guru, says that having at least six months of expenses saved is a good place to start. Economists are predicting a 40%-60% chance of a recession. With the increase in tariffs, goods and service prices become inflated, which in turn could lead to a recession. There are many ways to save money, the tricky part is finding a way that works for each individual and family.
