May 15, 2025
The stock market turmoil has deepened to the point where even some of President Trump’s staunchest allies are voicing concern.
After the so-called “Liberation Day” announcement, conservative commentator Ben Shapiro criticized the administration’s erratic economic approach, calling the now-paused tariffs a covert tax hike on consumers and businesses nationwide.
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" Trump's reciprocal tariffs impose hundreds of billions of dollars in new taxes on Americans,” said Shapiro on his podcast. “[It] would be the largest tax increase since the Revenue Act of 1968. One of the biggest tax increases on American consumers in the history of America."
Surprisingly, Shapiro’s description of the Trump tariffs, which were paused for 90 days on April 9, echoes that of former Vice President Kamala Harris, who referred to Trump’s tariff proposals as a “sales tax on the American people” during last year’s campaign.
Here’s why the administration is facing growing backlash for its global trade war — even from its core supporters.
Covert tax hike
While Trump calls tariffs a “beautiful thing to behold,” economists would describe them as import taxes.
“Tariffs are federal taxes, set by Congress, and applied to goods at the border,” confirmed Robert Gulotty, an associate professor in the Department of Political Science at the University of Chicago.
In many cases, these additional taxes are passed along to the consumer. The Peterson Institute for International Economics estimates that an average American family pays an additional $1,200 per year due to tariffs.
It’s worth noting that the institute’s analysis already factors in the offsetting impact of the extended Tax Cuts and Jobs Act but does not account for additional tariffs announced by the Trump administration after February. Put simply, the true cost to families is likely much higher.
Since many consumers and businesses cannot afford these added expenses, the economic outlook has weakened, and the stock market appears to reflect that.
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$11 trillion wealth destruction
From the beginning of this year through May 15, the S&P 500 had lost roughly 11% in value, while the Nasdaq-100 and Dow Jones Industrial Average had both fallen by 12% and 12%. According to MarketWatch, U.S. stocks had lost $11 trillion in market value in the months since Trump's inauguration. The Dow Jones and S&P 500 did experience a big jump once tariffs were paused.
However, the rapid erosion of wealth on this tariff-laden rollercoaster has left many ordinary Americans questioning the White House’s economic policies. According to a recent Reuters/Ipsos poll, Trump’s approval rating stands at 43%. Meanwhile, another poll by the Marquette Law School found that 58% of adults believe tariffs hurt the U.S. economy.
Unfortunately, these polls haven’t swayed the president’s position. Trump's added tariffs on China now stand at 30% after the two sides resolved their differences and continued to talk.
With no resolution in sight, consumers and investors should brace for a prolonged global trade conflict.
Look for a safe haven
If tariffs start back up again, consumers should build a margin of safety into their household budgets in anticipation of rising costs. Meanwhile, investors may want to seek refuge in hard assets like gold. The price of gold has surged 15.8% over the past six months.
However, no asset class or nation is immune to the economic volatility that appears to be in store ahead.
"Trade wars are, in fact, not good and not easy to win, particularly if you don't actually have a plan," Shapiro said.
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Vishesh Raisinghani is a financial journalist covering personal finance, investing and the global economy. He's also the founder of Sharpe Ascension Inc., a content marketing agency focused on investment firms. His work has appeared in Moneywise, Yahoo Finance!, Motley Fool, Seeking Alpha, Mergers & Acquisitions Magazine and Piggybank.
