During Donald Trump’s State of the Union address last month, the president championed the revival of his tariff agenda as a win for Main Street America. The levies, he said, would be paid for by foreign countries, “taking a great financial burden off the people that I love.” Quite the contrary, according to what mom-and-pop businesses are telling the Federal Reserve.
Instead of an income tax replacement, as Trump has repeatedly described them, the data suggests the costs of tariffs have been primarily shouldered by U.S. companies and consumers. For American small businesses in particular, the backbone of the economy, there is less flexibility to diversify their operations or absorb costs and tariffs have completely rewritten the script, with massive implications for the national economy.
