Economics Thread
- Thread starter sturg33
- Start date
zitothebrave
Connoisseur of Minors
Until they report it down.
It’s so comical.
sturg33
I
Some light reading for you. I asked grok if the and how the tarrifs impacted small businesses
Yes, tariffs implemented in April 2025 significantly impacted small businesses in the United States, based on available reports and analyses. These tariffs, announced by the Trump administration, included a 10% baseline tariff on all imports effective April 5, 2025, with higher reciprocal tariffs on approximately 60 countries starting April 9, 2025 (e.g., China at 34%, EU at 20%, Vietnam at 46%). Additionally, specific tariffs, such as a 25% levy on automobiles and auto parts not made in the U.S., were enacted, alongside earlier tariffs on Canada, Mexico, and China from March 2025. Below is a detailed breakdown of the impacts on small businesses, supported by economic analyses and sentiments expressed in various sources.
Key Impacts on Small Businesses
Increased Costs for Imported Goods and Materials
Tariffs raised the cost of imported goods, which many small businesses rely on due to limited domestic sourcing options. For instance, small businesses importing materials from China faced tariffs that escalated to 145% by April 10, 2025, before a partial reduction to 30% on May 14, 2025.
Example: Emily Ley, owner of Simplified, an online stationery business, reported an additional $630,000 in import duties over the next year due to tariffs on Chinese-made products, describing the impact as "catastrophic" to her business.
Small businesses, operating on thin profit margins, often lacked the purchasing power of larger corporations to negotiate discounts with suppliers, forcing them to either absorb these costs or pass them on to customers.
Supply Chain Disruptions
Tariffs disrupted global supply chains, making it harder for small businesses to secure necessary goods. The sudden imposition of tariffs, coupled with retaliatory tariffs from countries like Canada (25% on U.S. goods) and China (up to 125% on U.S. exports), created uncertainty and delays.
For example, small businesses reliant on Chinese suppliers reported canceled freight orders and abandoned shipments due to the high tariffs, particularly affecting industries like furniture, toys, apparel, and footwear.
Construction businesses faced higher costs for materials like steel, aluminum, and Canadian softwood, with steel prices rising 12-15% in February 2025, impacting project viability and profit margins.
Pressure to Raise Prices or Absorb Costs
To offset tariff-related costs, many small businesses faced the dilemma of raising prices or absorbing the costs, both of which posed risks. Raising prices could lead to loss of customers, especially for price-sensitive markets, while absorbing costs reduced already slim profit margins.
Example: Sarah Wells, owner of Sarah Wells Bags, noted that her business faced a 54% tariff on Chinese imports, eating into profits. She considered raising prices but worried about customer backlash, leading her to pause hiring and product development.
Some businesses, like Dame, a sexual wellness brand, implemented a $5 "Trump tariff surcharge" to offset costs, but this did not fully cover the increased expenses.
Retaliatory Tariffs Affecting Exporters
Small businesses exporting to countries like Canada, China, and the EU faced retaliatory tariffs, which reduced their competitiveness abroad. For instance, Canada imposed tariffs on $29.8 billion worth of U.S. goods, including steel and aluminum, effective March 13, 2025, and later a 25% tariff on select U.S. vehicles.
This hurt small businesses selling American-made products overseas, as higher prices due to tariffs led to reduced demand and potential boycotts driven by anti-American sentiment.
Economic Uncertainty and Reduced Business Confidence
The rapid changes in tariff policies, including exemptions, pauses (e.g., a 90-day pause on country-specific tariffs except China on April 9), and fluctuating rates, created significant uncertainty. Small businesses struggled to plan for the future, leading to reduced investment, hiring freezes, and scaled-back operations.
A CNBC/SurveyMonkey poll conducted April 21-25, 2025, found that 51% of small business owners expected negative impacts from trade policy changes over the next 12 months, with 66% either already affected or anticipating effects.
Posts on X echoed this sentiment, with users like
@caroljsroth
warning that small businesses, already battered by COVID, supply chain issues, and inflation, could not withstand the "government-induced shock" of tariffs.
Disproportionate Impact Compared to Large Businesses
Small businesses were disproportionately affected due to their limited financial resources and inability to quickly adapt supply chains. Unlike large corporations like Apple, which received exemptions for tech products like iPhones, small businesses often lacked the lobbying power to secure similar relief.
For example, giants like Walmart could pressure suppliers for discounts, while small retailers had no such leverage, forcing them into "survival mode" with reduced product selections and paused growth plans.
Sector-Specific Challenges
Retail: Small specialty retailers faced unsustainable packing costs, with some reconsidering entire business models. E-commerce businesses sourcing from platforms like Alibaba and Temu were hit by a 54% tariff on small packages from China.
Automotive: Small businesses reliant on fleet vehicles saw increased costs for purchasing and maintaining vehicles due to the 25% tariff on foreign auto parts.
Construction: Higher costs for steel, rebar, nails, and HVAC equipment eroded profits, especially for businesses locked into fixed-price contracts without tariff provisions.
Manufacturing: Small manufacturers struggled to source materials domestically, with many reporting that "you cannot source everything in the United States," creating existential challenges.
sturg33
I
You are free to argue that these disruptions are worth it in the long run, but denying the disruption exists is retarded
sturg33
I
You can be a big boy and actually defend your stupidity, but eaiser to be scared I guess
(What is this, like your 4th protest against me? Lol. Such an alpha!)
sturg33
I
Do we no longer consider Americans having to absorb price hikes as "pain?"
"ITS ALL SO COMICAL!!!"
The consumer is such a chicken shit way to describe the poorest Americans in this context.
Yeah man, I’ll be sure to remind people of that detail when back to school shopping is suddenly more expensive this fall.
They see the world caving to Trumps demands.
They see the jobs report on full time labor and increased wages which prioritizes Americans.
They see the future investment rolling in
We are going to get a tsunami of great economic news over the next 1.5 years. All the worrying on tariffs are going to seem comical.
Friendly reminder that the thing that keeps driving recovery within the markets is a reduction from the initial LD tariffs.
Markets went haywire in response to LD, then recovered gradually as we backed off from those insane figures.
As for projections of a roaring economy, I don’t remember you cheering this one on:
Honestly, probably the latter. It’s why I laughed at the people hyping up the “tariff surcharge” lines because if you trust the likes of Amazon or Temu to faithfully adhere to that figure, you’re going to be bamboozled. It’s marketing disguised as transparency, despite my belief that the tariffs will cause those increases.