The Dictatorship
What Trump’s tariffs mean for the price of your shirts
![What Trump’s tariffs mean for the price of your shirts](https://bluelightnews.com/wp-content/uploads/2025/02/5641-what-trumps-tariffs-mean-for-the-price-of-your-shirts.jpg)
On Saturday, President Donald Trump is expected to announce new tariffs on three of our biggest trading partners: 25% on all imports from Canada and Mexico and 10% on China. The exact timeline for implementation is up in the air. But if — or when — they go into effect, what will that mean for you?
Given the amount of misinformation flying around, any article about tariffs should start with the basic facts of the case. Only then can we talk about what the Trump administration might be about to do in this space, perhaps as soon as this weekend, along with the economic and political implications.
The first person to pay the tax is not necessarily the last
Tariffs are a tax on imports (and if there’s any doubt whether tariffs are really taxes, note that Trump wants to change the nameof these import-tax collectors to the “External Revenue Service”). That tax is paid by the company importing the good when that good enters the country. So, when an American retailer imports shirts from China, under Trump’s tariffs that company pays a tax that could be as high as 35% when that container of shirts hits the U.S. port. The tariff is collected by the U.S. Customs and Border Protection agents at over 300 ports of entry across the land.
What happens next is a matter of empirical economics. A fundamental concept in taxation — and tariffs, again, are a tax — is that the first person to pay the tax is not necessarily the last.
Let’s start by thinking through whocouldultimately pay the tax. That would be a) the importing company, b) the exporting company, c) the consumer who ultimately buys the shirt, which, due to the tariff, is now more expensive (a fourth channel can occur through exchange rates, wherein a stronger dollar can offset part of the tax, but this effect tends to be small).
So, who eats the tariff: the importer, the exporter, or…you (the consumer)? I’m sorry to report that the research suggests it’s you. Most of the tariff gets passed through into higher consumer prices. Perhaps the clearest example of this was when Trump imposed one of his first tariffs back in 2018 on imported washing machines. The price of both imported and domestic washing machines subsequently increased, by about $86 per unit according to one estimate. Even the price of dryers, which weren’t tariffed but are often sold with washers, also rose!
Trump claims that the exporter pays the tariff, by lowering the price they charge to the importer. But a moment’s thought shows this argument to be both empirically unfounded and, well, weird. The whole point of Trump’s tariffs is to rebuild domestic manufacturing by making imports more expensive. But if the exporter eats the cost, then the U.S. price doesn’t change, and MAGA’s mission is decidedlynotaccomplished!
At this point, you must be thinking, ‘Why would any country ever impose a tariff?’
How much might consumers get dinged by these tariffs? That depends on details that are still dribbling out (e.g., will Canadian oil exports be exempted?). A widely cited studyfrom the Peterson Institute predicts that Trump’s most sweeping plans would cost households an average of $2,600. My own estimate is that 25% tariffs on all imports out of Canada and Mexico and 10% on China would cost the average household $1,500-$2,000.
There’s yet another reason why tariffs won’t help American producers: about 45% of what we import are inputs, called “intermediate goods,” that go into American products. In Trump’s first term, for example, his administration introduced a tariff on imported aluminum, purportedly to protect U.S. aluminum producers. But the biggest U.S. producer of aluminum, Alcoa, which one might expect would be excited about the new policy, asked for (and received) an exemption from the tariff! It turns out that they import inputs from Canada.
The last reason Trumpian tariffs don’t work is because countries retaliate, raising their own tariff on their imports from the U.S. That’s one reason tariffs tend not to have much impact on the trade balance. They reduce both importsandexports.
At this point, you must be thinking, “why would any country ever impose a tariff?” In fact, narrowly targeted tariffs can be a fast and effective tool to block unfair trade in a particular product, especially when a trading partner is “dumping” a product (i.e., selling below cost to grab market share). We’ve successfully used these sorts of tariffs on everything from chicken parts to tires.
So, if I and every other economist, and now you, know all of this, what the heck is Trump and his team thinking?
That’s a trick question—who knows what these folks are thinking? But let’s just say, for the point of argument, that especially since Trump ran on lowering prices, making things more expensive isn’t really his top goal. And even if he doesn’t know or believe the price effects documented above, his economists do.
I strongly suspect that what’s probably going on here has a lot more to do with politics than economics.
One conclusion is that this is all theatre: threats to extract other goals from trading partners. We saw a microcosm of this last weekend in a dustup with Colombia. But in the cases of Canada and Mexico, this explanation is confusing, because it’s not clear what he’d wants from them. Yes, Trump claims he wants them to stop immigrant and fentanyl flows, but both countries have already successfully intervened to reduce these flows.
I strongly suspect that what’s probably going on here has a lot more to do with politics than economics. The president has an extremely acute radar for policies that resonate with his voters and he believes tariffs are one of those policies. He may be right: one studyof the trade war between U.S. and China during Trump’s first term concluded that people “more exposed to import tariffs became less likely to identify as Democrats, more likely to vote to reelect Donald Trump in 2020, and more likely to elect Republicans to Congress.”
On the other hand, the president may be underestimating the extent to which people have had more than enough of inflation. A new Quinnipiac pollfinds that more voters (48%) believe tariffs will hurt the economy, than the 42% that think they’ll help.
As is characteristic of this moment, we’re left with a lot of uncertainty about a presidential fixation that even he may know is a bad idea right now. We’ll soon know whether he’s willing to hit Americans with a painful tax increase, whether this is all just transactional Trumpian noise, or some combination of both.
Jared Bernstein
Jared Bernstein was chair of President Joe Biden’s Council of Economic Advisers.
The Dictatorship
Tulsi Gabbard, Trump’s pick to oversee US spy agencies, clears Senate committee
![Tulsi Gabbard, Trump’s pick to oversee US spy agencies, clears Senate committee](https://bluelightnews.com/wp-content/uploads/2025/02/5803-tulsi-gabbard-trumps-pick-to-oversee-us-spy-agencies-clears-senate-committee.jpg)
By David Klepper and FARNOUSH AMIRI
WASHINGTON (AP) — Tulsi Gabbard’s nomination to be President Donald Trump’s director of national intelligence cleared a key Senate committee Tuesday despite concerns raised about her past comments sympathetic to Russia and a meeting with Syria’s now-deposed leader.
A former Democratic congresswoman, Gabbard is one of Trump’s most divisive nominees, with lawmakers of both parties also pointing to her past support for government leaker Edward Snowden. But the Senate Intelligence Committee advanced her nomination in a closed-door 9-8 vote, with the committee’s Democrats voting no.
Gabbard’s nomination now heads to the full Senate for consideration. A vote has not been scheduled yet.
Following a contentious confirmation hearing last week, where some Republican senators questioned Gabbard harshly, GOP support for her fell into place following a pressure campaign over the weekend unleashed by Trump supporters and allies, including Elon Musk.
Until three GOP members seen as swing votes announced their support, it wasn’t clear her nomination would advance beyond the Intelligence Committee. Given strong Democratic opposition and thin Republican marginsGabbard will need almost all GOP senators to vote yes to win confirmation to the top intelligence job.
Though some Republicans have questioned Gabbard’s past views, they support her calls to overhaul the Office of the Director of National Intelligence, which coordinates the work of 18 federal agencies focused on intelligence collection and analysis. GOP lawmakers have also taken aim at the office, saying it’s grown too large and politicized.
Senate Intelligence Chairman Tom Cotton, an Arkansas Republican, said Tuesday that he looked forward to working with Gabbard to “bring badly needed reforms” to ODNI.
Gabbard is a lieutenant colonel in the National Guard who deployed twice to the Middle East and ran for president in 2020. She has no formal intelligence experience, however, and has never run a government agency or department.
Gabbard’s past praise of Snowden drew particularly harsh questions during the nomination hearing. The former National Security Agency contractor fled to Russia after he was charged with revealing classified information about surveillance programs.
Gabbard said that while Snowden revealed important facts about surveillance programs she believes are unconstitutional, he violated rules about protecting classified secrets. “Edward Snowden broke the law,” she said.
A 2017 visit with Syrian President Bashar Assad is another flash point. Assad was recently deposed following a brutal civil war in which he was accused of using chemical weapons. Following her visit, Gabbard faced criticism that she was legitimizing a dictator and then more questions when she said she was skeptical that Assad had used chemical weapons.
Gabbard defended her meeting with Assad, saying she used the opportunity to press the Syrian leader on his human rights record.
She has also repeatedly echoed Russian propaganda used to justify the Kremlin’s invasion of Ukraine and in the past opposed a key U.S. surveillance program.
Democrats said Gabbard’s response to questions about her past views did little to satisfy them. Democratic Sen. Mark Kelly of Arizona said Gabbard lacks the judgment to take on a job that is so critical to the nation’s security.
“Healthy skepticism is a good thing, but when someone consistently embraces sensational, but poorly supported claims while dismissing the thorough assessments of our intelligence community, it becomes dangerous,” Kelly said in a statement explaining his vote. “But rather than ease my concerns, she confirmed them.”
In the latest instance of the “Make America Great Again” base pressuring senators to support Trump’s nominees, Musk blasted Republican Sen. Todd Young of Indiana as a “deep-state puppet” in a now-deleted social media post before the two men spoke and Musk later called him an ally.
Young, whose critical questioning of Gabbard had prompted speculation he might oppose her, confirmed Tuesday he would back Gabbard. Young said his tough questions for Gabbard were just part of the process.
“I have done what the framers envisioned for senators to do: use the consultative process to seek firm commitments, in this case commitments that will advance our national security,” he wrote in statement announcing his support for Gabbard.
The Dictatorship
Trump just showed us why he’s not winning the Nobel Peace Prize anytime soon
![Trump just showed us why he’s not winning the Nobel Peace Prize anytime soon](https://bluelightnews.com/wp-content/uploads/2025/02/5772-trump-just-showed-us-why-hes-not-winning-the-nobel-peace-prize-anytime-soon.jpg)
UPDATE (Feb. 4, 2025, 8:35 p.m. E.T.): During a joint press conference Tuesday night with Israeli Prime Minister Benjamin Netanyahu, President Donald Trump said: “The U.S. will take over the Gaza Strip and we’ll do a good job with it, too.”
As Israeli Prime Minister Benjamin Netanyahu visited President Donald Trump at the White House on Tuesday and King Abdullah II of Jordan does the same on Feb. 11, one question keeps bubbling up to the surface: Can Donald Trump, the self-professed “peacemaker” who has eyed the coveted Nobel Peace Prize for many years, go where no U.S. president has gone before by striking a transformational, comprehensive peace deal in the Middle East?
Trump’s critics would answer with a big eye roll. And yet his pressuring of Netanyahuto sign onto the first stage of a three-phase ceasefire deal with Hamas — three more hostages were freed over the weekend in return for more than 100 Palestinian prisonersthe fourth round of prisoner exchanges since the deal took effect in mid-January — at least gives some credibility behind the ambition. Trump clearly has Middle East peace on his mind, and the Trump administration’s desire to expand the 2020 Abraham Accordswhich normalized relations between Israel and four Arab countries, is never far from its lips. As national security adviser Mike Waltz said before Trump even stepped foot into office for his second term, Israeli-Saudi normalization is a “huge priority” for the team.
Trump clearly has Middle East peace on his mind.
But Trump can kiss all of this goodbye if he intends to move forward with his ongoing calls to expel the Palestinian population from Gaza, an idea he referenced during his joint press conference with Netanyahu at the White House. While he didn’t specifically use the word “expel” in his remarks, his suggestion that Palestinians might want to think about packing up their things and going to another area while reconstruction commences has caused shock and trepidation across the Arab world. Trump even suggested that his plan was in the works, with various countries contacting him and pledging assistance. Whether or not that’s the case, Trump appears increasingly invested in making this relocation scheme a reality. “Gaza is a demolition site right now,” Trump told reporters on Tuesday. “You can’t live in Gaza right now.”
If this were just another one-off, rambling comment from Trump, perhaps it could be dismissed as a nothing-burger. But it isn’t. Trump has referenced this idea on earlier occasions, first on Jan, 28, when he name-dropped Egyptian President Abdel Fattah el-Sisi and Jordanian King Abdullah for help in taking Gaza’s population in, and again on Jan. 31, when he was signing executive orders in the Oval Office. Asked by a reporter about Egypt and Jordan’s refusal to play along, Trump matter-of-factlystated that they didn’t have a choice: “They will do it. They will do it. They’re gonna do it, OK? We do a lot for them, and they’re gonna do it.”
Trump’s pretensions aside, Egypt and Jordan have their own reasons for not wanting to turn themselves into Trump’s enforcers. The most obvious, of course, is that such a proposition is extraordinarily unpopular in the Arab world. Countries throughout the Middle East disagree on a lot of things, but dislocating more than 2 million Palestinians from their homes in Gaza and opening the door to Israeli annexation of the coastal enclave — a fantasy ultranationalist Israeli ministers like Bezalel Smotrich surely dream about — certainly isn’t one of them. If there was any dispute about that, the Arab League put it to rest over the weekend, when it released a statementthat such plans “threaten the region’s stability, risk expanding the conflict, and undermine prospects for peace and coexistence among its peoples.”
Egypt and Jordan also have self-interested reasons for dismissing any Gazan relocation effort. Jordan, for one, is already hosting more than 2 million Palestinianswho are registered as refugees, making approximately half of the kingdom’s population of Palestinian origin. As a resource-poor country, Jordan doesn’t have the luxury of sustaining a new influx of new refugees and wouldn’t want to, even if Washington or its Gulf allies picked up the tab (the U.S. already provides Jordan with $1.45 billionin foreign aid every year). For Egyptian President Sisi, the issue is less about economics and more about security. This is the same guy, after all, who led a 2013 military coup against a democratically elected Muslim Brotherhood-led government (Hamas was established in 1987 as an affiliate of the Muslim Brotherhood), killed more than 800 peoplein the process and jailed tens of thousands more in an attempt to snuff out any resistance. If Sisi wasn’t willing to let Palestinians into Egypt when Israeli military operations in Gaza were at its height, he’s unlikely to do so when the guns have fallen silent (for the time being).
Encouraging or compelling Palestinian civilians to leave Gaza, even if it’s ostensibly to accelerate reconstruction, is liable to kill Trump’s diplomatic agenda in the Middle East.
Encouraging or compelling Palestinian civilians to leave Gaza, even if it’s ostensibly to accelerate reconstruction, is liable to kill Trump’s diplomatic agenda in the Middle East. At the top of the wish list is an Israeli-Saudi normalization accord, something his predecessor Joe Biden couldn’t finalize before his term ended, despite a year-and-a-half of talks with Israeli and Saudi officials. Such a deal would be a groundbreaking accomplishment for Washington in a region often associated with sunk costs, self-defeating policies and missed opportunities. And just as important for Trump, it would be an extremely impressive achievement he could rightfully brag about.
Yet none of it will happen if Palestinians are forced to leave their own lands. It would snuff out an expansion of the Abraham Accords before the Trump administration even got the ball rolling. Although the Saudi government may have been open to a normalization deal with Israel before the war in Gaza, it’s no longer content with token Israeli concessions on behalf of the Palestinians. The Saudis now want a concrete pathway toward the establishment of a Palestinian state. As Saudi Crown Prince Mohammed Bin Salman said in September, “The [Saudi] kingdom will not stop its tireless work towards the establishment of an independent Palestinian state with East Jerusalem as its capital. We affirm that the kingdom will not establish diplomatic relations with Israel without that.” The Saudi foreign minister reiterated that position in Novemberand it’s about as clear as it can get: Normalization without a Palestinian state (or at least a tangible process that leads to one) is impossible.
Trump, therefore, needs to ask a fundamental question: What’s more important to him? Doing something all of his predecessors couldn’t do — shepherding formal diplomatic relations between Israel and the Arab world’s most important state — or catering to the whims of Israel’s ultranationalists by proposing a cockamamie scheme that equates to deporting more than 2 million Palestinians from their own homes? The first is difficult to achieve but still doable; the second would cause more problems than they’re worth by compromising Washington’s diplomatic relationships in the Middle East, pushing his dream deal further away, and even risking the collapse of a ceasefire deal in Gaza he helped usher into being. And in this scenario, Trump can forget about seeing his name in the annals of Nobel history.
Daniel R. DePetris is a fellow at Defense Priorities and a syndicated foreign affairs columnist at the Chicago Tribune.
The Dictatorship
Pam Bondi confirmed as Trump’s attorney general
![Pam Bondi confirmed as Trump’s attorney general](https://bluelightnews.com/wp-content/uploads/2025/02/5774-pam-bondi-confirmed-as-trumps-attorney-general.jpg)
Pam Bondia former Florida attorney general and a staunch loyalist to President Donald Trumphas been confirmed as attorney general by the Senate.
In a 54-46 vote Tuesday, the Senate confirmed Bondi to lead the Justice Department. The vote fell along party lines, with the sole exception of Sen. John Fetterman, D-Pa., who joined the Republicans in favor of confirmation.
Bondi, who was picked after former Rep. Matt Gaetz’s nomination flamed outfaced a relatively smooth confirmation hearing. Democrats on the Senate Judiciary Committee questioned her about whether she would be willing to act independently of Trump, who has historically sought to bend his attorneys general to his will. She easily dodged some difficult questions and pleaded ignorance to others.
Bondi represented Trump in his first impeachment trial and has stood by him throughout his various legal troubles. She also backed his unfounded claims of widespread election fraud in 2020. As the country’s top prosecutor, she will serve in a role that has proved challenging under Trump in the past.
During his first term, Trump’s relationship with his first attorney general, Jeff Sessions, quickly soured after Sessions recused himself from the DOJ investigation into Russian interference and potential collusion with the Trump campaign in the 2016 election. Trump repeatedly attacked Sessions, prompting him to issue rare public statements asserting his independence.
Trump’s next attorney general, William Barr, was arguably more obliging toward the president. Still, Barr resigned a month before Trump’s term ended after disputing his election fraud claims in 2020.
President Joe Biden’s attorney general, Merrick Garland, was also a frequent target of Trump’s — as was special counsel Jack Smith, who led two criminal investigations into Trump’s conduct. Smith resigned ahead of Trump’s inauguration, and Trump on Tuesday fired several DOJ employees who worked on those cases.
Bondi may not face the same challenges that previous attorneys general have had to contend with. While she testified during her confirmation hearing that “my duty … will be to the Constitution and the United States of America,” she has shown fierce loyalty to Trump in the past.
This is a developing story. Check back for updates.
Clarissa-Jan Lim is a breaking/trending news blogger for BLN Digital. She was previously a senior reporter and editor at BuzzFeed News.
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