Trump Doesn't Get Tariffs or Free Markets
The administration insists that tariffs don’t raise prices — but as costs mount, companies face pressure to hide the truth from consumers while reshoring remains years away and far more expensive.
President Donald Trump is again demonstrating he lacks even a fundamental understanding of how tariffs — or free markets — work.
He insists that tariffs are a strategic win, a cost foreign countries and companies bear for accessing the U.S. market. In his telling, tariffs function like an entry fee: painless for American consumers and lucrative for the U.S. Treasury. “Oftentimes, the country picks them up. Oftentimes, the company picks it up,” Trump recently said. “The people don’t pick it up, OK? The people don’t pick it up.”
That assertion is increasingly at odds with economic fundamentals and mounting pressure on American businesses. As the administration makes the tariffs permanent, with officials preparing letters to notify countries worldwide, business leaders and economists warn that the current stability may not last.
Inflation has remained relatively low, even cooling slightly in April, and unemployment continues to hover near historic lows, offering temporary cover for the administration’s claims. “The United States has the leverage to make our trading partners ultimately bear the cost of tariffs,” said White House spokesman Kush Desai.
But the strain is beginning to surface. Retailers and manufacturers warn they can no longer absorb rising import costs without passing them along to consumers. Walmart, the nation’s largest retailer, has said publicly that price increases could begin as soon as the end of the month. “We probably would not be able to absorb all the pressure from the president’s tariffs for much longer,” said CEO Doug McMillon on an investor call.
Rather than acknowledge these pressures, the Trump administration has tried to suppress them. After Walmart CFO David Rainey confirmed that tariff-related price hikes were imminent, Trump responded on social media: “EAT THE TARIFFS. Don’t charge valued customers ANYTHING. I’ll be watching.”
This posture extends beyond Walmart. When Amazon explored displaying tariff-related costs at checkout — a modest step toward transparency — the administration denounced it as “a hostile and political act.” When Mattel warned it might raise prices on toys like Barbie, Trump threatened a 100 percent tariff on its products.
These public rebukes expose the contradiction at the heart of the administration’s tariff narrative. U.S. businesses wouldn't be under pressure if foreign countries were truly paying the tariffs. There would be no “eat” costs and no need for threats or public shaming. In practice, tariffs are taxes on U.S. importers — and like all business costs, they are ultimately passed along to consumers in the form of higher prices, reduced product quality, or diminished availability.
“Across the retail space, you’re going to see firms increasingly be overt about the pressure they’re feeling,” said Gregory Daco, chief economist at EY-Parthenon. “There’s an increasing likelihood they’ll pass on at least part” of those costs to consumers.
So far, price increases have been muted, partly due to companies stockpiling goods ahead of the tariffs. But that inventory cushion is dwindling. Economists warn that as the tariffs become permanent and global supply chains adapt, the impact will grow more pronounced — and harder to hide.
Supporters of the tariff regime argue that the pressure on foreign suppliers will encourage U.S. companies to bring manufacturing back home. Even if that were true, the transition would take years. The infrastructure to replace global production networks doesn’t exist today, and building it requires enormous capital, time, and labor — all while companies face pressure to maintain low prices. Economists broadly agree that American-made goods would be substantially more expensive than imports from low-cost markets, and those costs would again fall on consumers.
This is what makes the administration’s position particularly problematic. Trump, who once condemned federal grocery price controls proposed by Vice President Kamala Harris as “Soviet-style,” is now pressuring companies to keep prices artificially low in response to his government-imposed taxes, while concealing the reasons behind those prices.
It’s a clear break from the free-market principles long championed by conservatives and the Republican Party. The administration’s approach — imposing new taxes while dictating how companies respond — amounts to economic interventionism dressed in populist rhetoric.
Even some within the administration appear uneasy with the narrative. Treasury Secretary Scott Bessent tried to downplay Walmart’s warnings by suggesting the company would “eat some of the tariffs,” just as it supposedly had during Trump’s first term. But Walmart’s statements tell a different story. “We’ll keep prices as low as we can for as long as we can, given the reality of small retail margins,” said spokeswoman Molly Blakeman.
Meanwhile, congressional Democrats are calling for greater transparency. Senate Minority Leader Chuck Schumer urged retailers to disclose tariff-related costs directly to consumers. “People deserve to know the impact tariffs have on their finances,” he said. Legislation has been introduced to mandate such disclosures, though its prospects in a Republican-led Congress remain slim.
The administration’s urgency to lock tariffs in as a permanent feature of U.S. trade policy only raises the stakes. While markets have remained mostly steady, warning signs are emerging. Small businesses are cutting product lines, and global retailers are renegotiating supplier terms or withdrawing from U.S. platforms altogether.
For now, the White House continues to argue that the economic effects of its tariff policy are minimal and manageable. But as stockpiles run out and long-term structural costs emerge, the gap between rhetoric and reality will become harder to deny.
If foreign governments were truly footing the bill, American businesses wouldn’t be under pressure, and certainly wouldn’t be asked to conceal the costs from customers. The fact that they are, and that the administration is actively working to silence them, tells the real story.
Trump’s departure from free-market orthodoxy isn’t just tactical — it’s rooted in a belief that tariffs are a blunt-force tool for coercion and retribution. That belief is now so entrenched, he appears willing to reject basic economic reality, not just to the public, but to himself.
A Call from One American Grandma to Another: Stand Up for Our Families
My fellow Americans,
Especially my beloved grandmothers—
We’ve seen hard times before, and we’ve held our families together through them. We’ve rolled up our sleeves, dried tears, baked bread from scratch, and made every dollar stretch. But now, we’re facing a new kind of hardship—one quietly disguised as policy: devastating tariffs that will cause prices to skyrocket and shelves to empty. And who will feel it most? Our children and their children.
These new tariffs aren’t just numbers on a trade spreadsheet. They are a direct hit to the kitchen tables of young families already struggling to make ends meet.
A bag of diapers could cost more—while wages stay the same.
A can of baby formula or a pack of wipes might become harder to find—because components are stuck in a tariff trap.
Everyday basics like pasta, beans, or a box of cereal will creep up in cost—while young parents are told to “tighten their belts.”
This is not just policy. This is pain at the register.
And while millionaires and billionaires won’t flinch, the single mom pushing a cart with a toddler and a newborn will.
I’m asking us—the grandmothers, the wise ones, the anchors of our families—to raise our voices peacefully but powerfully. We know what sacrifice looks like. We know how to stand up when something isn’t right.
Let’s write.
Let’s call.
Let’s march.
Let’s post.
Let’s share the truth that’s being swept under the rug.
Because these tariffs aren’t about strength—they’re about control.
They’re not making us safer—they’re making our groceries more expensive and our future more uncertain.
We must remind this country what democracy really looks like.
It looks like grandmothers speaking up.
It looks like families standing together.
It looks like peaceful resistance for the sake of those yet to grow strong enough to fight for themselves.
We are the memory keepers and the truth tellers. Let’s be the protectors now.
With fierce love and unwavering hope,
Clarissa Sr.—an American Grandma
United by faith, family, and freedom.