Even Ben Shapiro blasted Trump tariffs as one of the ‘biggest tax increases’ in US history — warns Americans will get smoked with ‘hundreds of billions of dollars’ in taxes. Do you agree?

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 April 7, the S&P 500 had lost roughly 15% in value, while the Nasdaq-100 and Dow Jones Industrial Average had fallen 18% and 12%, respectively. According to MarketWatch, U.S. stocks have lost $11 trillion in market value since Trump's inauguration. The Dow Jones and S&P 500 did experience a big jump once the 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 now stands at just 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. On April 7, he announced an additional 50% tariff on Chinese imports if it doesn’t withdraw its 34% reciprocal tariffs on American imports, according to the Associated Press. In other words, the trade war is escalating.

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.