President Donald Trump has used tariffs as a negotiating tactic with international governments. But those tariffs might be hurting U.S. consumers more than anyone else, according to a new study.
The tariffs and Trump’s broader trade policies with foreign governments reduced U.S. consumers’ monthly income by $1.4 billion by November 2018, according to a study from the Federal Reserve Bank of New York and both Princeton and Columbia Universities. The study, which was obtained by CNBC, found that tariff costs were passed on to the goods consumers have been buying. The countries that were slapped with U.S. tariffs didn’t take on any of the cost burden.
Tariffs have been a core component in the President’s negotiations with the Chinese government and others. The Trump administration has argued that tariffs could be used to improve trade deficits with China and protect American intellectual property.
However, the researchers found that with each new tariff on goods from China, the costs associated with that were passed on to U.S. consumers. Between January and November 2018, a total of $6.9 billion in U.S. income was lost to the tariffs, according to the study.
In addition to the costs associated with the tariffs, the researchers found that the U.S. was hit by less variety in imports. Companies operating overseas that didn’t want to face tariffs ultimately decided against exporting to the U.S. And that ultimately gave consumers less choice in the products they bought.