It was just 10 days ago that Congress (specifically the Republican majority in Congress) was patting itself on the back for passing a massive tax cut (and massive increase in the national debt). Because that was the most important thing to them – making the tax cuts permanent (only the high income tax cuts, not the cuts for working families, seniors, or people who get tips – they expire at the end of the Trump term). They rejected tax increases on people making over $1 Billion – that’s how much tax increases were despised by this Congress.

This week, the self-described best deal maker in the world, President Donald Trump, sent letters to dozens of countries (or at least posted letters on his Truth Social account) indicating that the tariffs would be imposed as of August 1st. Apparently trade deals would not be required, after promising 90 deals in 90 days. In the case of Asia, where the US had many allies, the letters have done little more than frustrate the countries and push them closer to China. In India, the Modi government has already moved ahead with a retaliatory tariff proposal to the WTO. For most countries, there is little reason to negotiate with a country that unilaterally chooses when to tear up its trade agreements and sets deadline after deadline, only to not follow through. How can anyone negotiate with a party they cannot trust?

So what will these tariffs mean for Americans? Well it means that every import subject to a tariff will pay that tariff to US Customs when it enters the US. So the first payor of the tariff is an American company. And unlike corporate income taxes, which tax profits on the sale of goods and services, this tax (because tariffs are a tax) will be paid on the cost of goods sold by American companies. Those companies can either bake that cost increase into their prices and pass them on to consumers, or they can absorb some or all of the costs of the tariffs. If they absorb any of the costs, then the profits of the company will decline and the value of the company will decrease – if the company is a publicly held company, then its stock price will decline and the investment portfolio of pension plans, investment firms and individuals will be reduced. Either way, the wealth of Americans will decline.

So how much is this tax? It depends on who you consult, but the cost is thought to be between $2 trillion (The Tax Foundation) and $4.5 Trillion (Penn-Wharton Budget Model) over the next 10 years. That’s somewhere between 0.67% and 1.5% of GDP, making it the largest tax increase in at least 40 years (and perhaps the largest since Americans were asked to pay for the consequences of World War II). On a $ basis, this tax increase makes all previous tax increases look paltry. The anticipated hit to economic growth is about 0.8% in the short run with a nearly 2% increase in the rate of inflation. Who voted for that?

So where is the outrage from the Republicans in Congress? Some have introduced legislation to require Congressional approval for tariffs – in three months since its filing, this bill has failed to receive a hearing. But leadership has been mute on the topic – despite the threat to businesses in their states, both those who import goods and parts as well as those who export goods. The exporters may be the first to feel the effects of this concocted trade war, through lower sales internationally. In Canada, our second largest trading partner, imports from the US have declined for three consecutive months (and while Canadian exports to the US have also declined, overall exports have rebounded as Canada finds other sources of demand for their goods).

So let’s reframe – increased taxes on billionaires is a no-go, but massive inflationary tax increases on consumers is OK. Gotcha! This is the big, beautiful policy of this administration and Congress?

And the national disgrace continues…