March 17, 2025
Win McNamee/Pool via Imagn Images
The rollout of President Donald Trump's tariffs has caused uncertainty and confusion as investors, consumers, economists and the public try to keep track of the latest updates.
President Donald Trump's fluid rollout of his tariff strategy has caused uncertainty and confusion as investors, consumers, economists and the general public try to keep track of the latest updates.
Everything from cars and motorcycles to aluminum and steal to whiskey and wine have been caught in the crosshairs of U.S. trade wars with China, Europe, Canada and Mexico.
To better understand the implications of this back and forth of levies, PhillyVoice talked to Josh Mask, an assistant professor in the economics department at Temple University.
This interview has been edited for length and clarity.
PhillyVoice: How will Americans be affected by these tariffs and will the impact be immediate?
Josh Mask: It depends on the good in question. Some things immediately, some things could take a much longer period of time.
The night that Trump initiated the 25% tariffs on Canada and Mexico – this is before he rolled many of them back – there was an immediate change in rates that Canadian energy producers charged American customers. So people in places like Maine, where part of their grid is fed from energy sources in Canada, they saw their rates change overnight. So for things like that, it can be instantaneous.
For avocados, raspberries and limes, those kinds of items that are big imports from Mexico, those you would see just as soon as the grocery stores have to order the next batch. So that would be maybe in the matter of a week or two.
And the Chinese tariffs, a lot of the stuff we get from them is consumer electronics. So think of Best Buy when they're running low on the PlayStations, they have to order a new stock of them. And those Chinese tariffs are still in place, so I do expect a lot of consumer electronics to start going up as soon as May.
STEVE HEASLIP/USA TODAY NETWORK via Imagn ImagesPresident Donald Trump's tariffs on Mexico could result in Americans paying higher prices avocados.
PV: A lot of past presidents and economists have been critical of this strategy. What is the path to this working?
JM: I think the charitable interpretation that economists would give is that if this is a means to an end, in terms of a new trade bill, that has more favorable terms for the United States, I think that's what it's typically sold as.
The president speaks a lot about the McKinley era, when we did have high tariffs. But the difference between McKinley's day, which is late 1890s, and today, is that we weren't a global hegemon at the time. A lot of our government spending is the military, the VA, Social Security, Medicare and Medicaid. We didn't have those things in place in the 1890s, so if we were to replace income tax revenue with tariff revenue, you're talking about global deficits blowing up because we're simply not going to be able to pull that kind of income from tariffs that you would be able to from income taxes.
PV: Could these tariffs help reduce the debt?
JM: To the extent that it's additional revenue, but it's just minuscule compared to what our costs are.
The unfortunate thing, and I know this is more of a political question, but if we truly want to tackle the debt, we've got to figure out our entitlements. We have a lot of promises that we've made to the American public and we simply just didn't have the requisite tax increases to pay for them. The only time that we really tackled the debt in earnest is during the Clinton administration, and one of the key facets of Clinton administration was tax increases.
PV: What will be the effects of Trump's plan for reciprocal tariffs on trading partners?
JM: There are some countries that we do pay pretty large tariffs to. India, in particular, is 60-70% tax for some goods. If he wants to put in place reciprocal tariffs to counteract that, that could be helpful if the countries then decide to lower their tariffs in response.
If it's targeted, it can sometimes help domestic industries, but having a broad-based tariff like this, what it's going to do is spur a trade war, which is going to be bad for the American consumer because everything that they buy is going to go up.
PV: Is there an indicator (stock market, grocery and gas prices, interest rates) to watch for that would show if these tariffs are having a positive or negative effect on the economy?
JM: If these do go into effect and they do cover all the United States-Mexico-Canada Agreement goods and services, I would expect to see an increase in the inflation rate – the consumer price index.
Now that doesn't mean that there's going to be a return to broad-based inflation like we saw in 2021, that's an open question that would depend on the Federal Reserve response.
The stock market has been a pretty good gauge in terms of how investors are taking this news, but I don't know how much of that is based on the tariffs and how much of that is just based on data that we've been getting that's showing that the American consumer is slowing down spending. So I think it's a little fuzzy from that regard.
