| The United States is still in a trade war with much of the world, and it may be ratcheting up soon. At the very least, the months-long uncertainty that has been stressing U.S. businesses will continue for the foreseeable future. This week, President Donald Trump threatened more tariffs and delayed others — but talked tough about finally putting high, widespread global tariffs in place next month. “There has been no change to this date, and there will be no change. In other words, all money will be due and payable starting AUGUST 1, 2025 — No extensions will be granted,” he said on social media Tuesday. This all comes as some economists warn that existing tariffs will soon spark higher prices for Americans. “The truth is, Trump wants high tariffs. He has them, and he intends to send them higher,” said Andy Laperriere, head of U.S. policy research at investment bank Piper Sandler, in a note to clients. “None of this will be settled soon, and there is no end in sight to trade instability.” Here’s what’s going on. Where tariffs stand Tariffs are a tax that economists say ultimately gets passed on to consumers, and Trump has been steadily increasing them. Trump’s tariff announcements can change by the week. But since April, there have been 10 percent tariffs on almost all goods coming into the U.S. There are also higher tariffs on Chinese imports, which at one point were so high that they virtually stopped trade between the world’s two largest economies. And there are tariffs on steel and aluminum and imported cars. On Tuesday, Trump announced major tariffs on copper imports and threatened more on semiconductors and pharmaceuticals. “When Trump took office, the average tariff rate in the U.S. was around 2.5 percent,” said Michael Strain, an economist with the conservative-leaning American Enterprise Institute. “And now it’s over six times as high.” “You can’t do that without raising prices for consumers on the goods,” he warned. Consumers haven’t felt them too much, though — yet So far, the overall economy has weathered the trade war, reports The Washington Post’s Lauren Kaori Gurley. But that may be ending soon. When Trump announced widespread tariffs in the spring, businesses bought a bunch of goods to sell at regular prices before tariffs kicked in. They are starting to run out of those goods. That means prices could start to rise on products ranging from groceries to school supplies, said Diane Swonk, chief economist with the accounting and auditing firm KPMG. “Much of what consumers are buying today were bought ahead of tariffs, as producers front-ran the costs,” Swonk said. “We will all be sweating it out in late summer as those inventories are drained.” The Federal Reserve warned of increasing inflation later this summer and said it’s holding off on cutting interest rates until it sees if tariffs drive up prices. Polls regularly show that Americans are largely skeptical of tariffs, and Trump’s approval on the economy is as low as President Joe Biden’s was at the end of his term, Reuters/Ipsos finds. Even more tariffs could be on their way On Monday, Trump threatened countries including South Korea and Japan with 25 percent tariffs in August unless they negotiate trade deals. He paired that with an announcement that really high tariffs for dozens of countries — which he paused when the stock market tumbled and the economy showed signs of a financial crisis — could start again in August. The original deadline for those tariffs was Wednesday, but Trump has few trade deals to speak of after the delay, and he signed an executive order Monday that pushed it back until Aug. 1. Those tariffs are 20, 30 or 40 percent for some countries, shocking even some of his wealthy supporters with the intensity. “This is not what we voted for,” pro-Trump billionaire influencer Bill Ackman said in April. Trump has said his tariff threats are a negotiating tactic (one of several reasons he has said he favors tariffs, which the U.S. hasn’t heavily used in the modern economy for decades). But his announcement was also widely seen as a refocusing on the trade war he started with much of the rest of the world months ago. He also threatened tariffs on countries that align with Brazil, Russia, India and China. “They’ll start to pay on Aug. 1,” he said on social media this week. “The money will start to come into the United States on Aug. 1, OK, in pretty much all cases.” The courts and Congress aren’t reliable checks on Trump’s tariffs In May, a little-known trade court ruled that tariffs were illegal and for Trump to stop them immediately. The court ruled that the president had essentially declared an economic emergency when there wasn’t one. That ruling is on hold and the tariffs are back in place while the lengthy legal battle plays out, which could take months or years. Congress could also take action, because the Constitution grants Congress the authority to impose tariffs. Trump’s tariffs have been so broad that some Republicans said they were open to the idea of voting to take back their authority, but Republican congressional leaders have largely put a stop to that possibility. Bottom line: There is so much uncertainty for the U.S. economy right now over what existing tariffs will do to it, and Trump is threatening even higher ones — again. Even if they don’t come to fruition, several economists said, the economy would still sustain damage. “Uncertainty acts as a tax on the economy,” said Swonk. “And it works with a lag.” | 
