Yves here. The lead stories in the press are about Trump’s August 1 tariff salvo, but it’s a little too soon for much in the way of analysis, as opposed to reaction. These tariffs are sure to increase inflation in the US even if some companies accept reductions in their lofty profit levels (corporate profits have been at a sky-high percentage of GDP for years). So we’ll turn to a new tool for estimating increases in living costs after a couple of hot takes on what Trump has wrought.
Just after the Trump tariff announcements, the Bureau of Labor Statistics released its jobs report, and it was a doozy. Not only was the headline number, a mere 73,000 new jobs markedly lower than expectations, and an increase in unemployment to 4.2%, which is not all that bad. But when you look under the hood, it’s much worse. From Bloomberg:
Rosenberg of BlackRock says the revisions show a “dramatically different picture” now when you look at the past three months. Before these numbers, the three-month average for payroll gains was 150,000. With the revisions for May and June and the new July figure, the three-month average is now 35,000. That’s entirely different.
Oh, and the reason for the big initial overstatement and then the revisions? The so-called birth-death models, which estimates employment growth resulting from new business creation. Those who were following the econoblogosphere in the runup to the financial crisis will recall Barry Ritholtz, Michael Shelock, and then-luminaries who are no longer posting regularly assailing the birth-death model results to be greatly exaggerated, among other reasons due to big falls in construction, and on a scale to distort the overall results.
And even before the jobs data hit the wires, some economists were stressing that the tariff increases would hurt demand. From a different Bloomberg account:
But at an average of 15%, the world is still facing some of the steepest US tariffs since the 1930s, roughly six times higher than they were a year ago. Trump’s latest volley outlined minimum 10% baseline levies, with rates of 15% or more for countries with trade surpluses with the US.
So far, the global economy has held up better than many economists expected after Trump’s initial tariff blitz. A rush to beat the elevated rates spurred a front-loading of exports, aiding many Asian economies and shielding US consumers from price spikes.
That could all be about to change.
“For the rest of the world, this is a serious demand shock,” Raghuram Rajan, former India central bank governor and chief economist of the International Monetary Fund, who is now a professor at the University of Chicago Booth School of Business, told Bloomberg TV on Friday. “You will see a lot of central banks contemplating cutting as the rest of the world slows somewhat in the face of these tariffs.”
In other words, in the US, the tariffs will increase stagflationary pressures. That view is confirmed by a report at CNBC:
The latest U.S. tariff policy is “still not the end of the story,” Stephen Brown, deputy chief North America economist at Capital Economics, said Friday.
“President Trump’s latest flurry of tariffs implies that the US effective tariff rate will rise to about 18%, from 2.3% last year,” he noted. That’s higher than expected and carries downside risks for global economic growth projections, as well as some upside risk for U.S. inflation forecasts, Brown said.
Additional comments:
CNN: An auto parts maker in Detroit just had to layoff 100 workers and shut down a warehouse. The owner specifically blamed tariffs.
STEPHEN MIRAN: It's always convenient to blame political changes when your business fails pic.twitter.com/USwB5yVA6H
— Aaron Rupar (@atrupar) August 1, 2025
We are just starting to pay the price for all the tariff incompetence.
The real damage hasn’t even begun. pic.twitter.com/GQ7VZR0guq
— Spencer Hakimian (@SpencerHakimian) July 31, 2025
Earlier this year, @SwissMFA caved in to pressure from the US and genocidal “Israel” and canceled a UN conference on Palestine in the hope of evading Trump tariffs. Here’s the reward for their abject cowardice and complicity. https://t.co/1Tl02XdusA pic.twitter.com/p7cxsAdNy3
— Ali Abunimah (@AliAbunimah) August 1, 2025
Brazil is the largest exporter of coffee to the U.S.
With Trump’s 50% tariffs on Brazilian imports, your coffee is about to get a lot more expensive. (Prices have already jumped over 15% in recent months.)
All because he wants to protect his corrupt friend Bolsonaro. Insane. pic.twitter.com/Tc9idaugEq
— Republicans against Trump (@RpsAgainstTrump) August 1, 2025
And some comic relief:
WH Press sec just now: "Upwards of 200 countries around the world have reached out to the trade and tariff team…"
There are 193 countries. 195 if you include the Vatican and Palestine.
Maybe the Highly Tariffed Penguins and other various animal groups have created nations? pic.twitter.com/nUOLvbmO4T
— S.V. Dáte (@svdate) July 31, 2025
Note that Trump’s tariff use of emergency powers to impose tariffs is facing a series of court challenges. Most experts expect Trump to lose. If that happens, it would not only wonderfully discredit Trump but also require a costly refunding of the tariffs collected.
With Jerome Powell having sat pat on interest rates, after Trump screamed for a cut, Trump will further increase pressure for the Fed chair’s ouster, which will only increase investor upset. But the odds are not trivial that Powell’s concern, of tariff-induced price increases, will be borne out in the next month or two. And as we have repeatedly pointed out, while a central bank’s interest rate increases can choke economic activity, it does not follow that putting money on sale provides a boost. Most businesses decide to expand operations based on conditions in their market, as in demand and competitor activities. The only enterprises where cheap money in and of itself might lead to incumbents to increase their activities are ones where the cost of money is one of their biggest expenses. Those are mainly financial institutions and financial speculators like real estate developers and hedgies.
Common Dreams has publicized a new way to get a better approximation of the real cost of Trump tariffs and other policy measures on household budgets, I hope some of you will road test it, and if is seems useful, encourage people you know, particularly in the press, in politics, or active in social media, to add it to their toolbox.
By Julia Conley, staff writer at Common Dreams. Originally published at Common Dreams
Six months into U.S. President Donald Trump’s second term, an economic justice group on Thursday unveiled an interactive tool to help Americans put a number on the unmistakable feeling many have reported having about the Republican leader who promised to “make America affordable again”: that costs have in fact gone up under Trump, and that the White House and the GOP are to blame.
Using the tool introduced by Unrig Our Economy, people across the U.S. can see exactly how much the price of essentials has gone up in their state, with the advocacy group connecting the dots between the rising cost of living and Trump’s tariffs as well as corporate tax breaks Republicans have relentlessly pushed to pass.
According to the “Don’t Inflate Our Plates” tool, the price of beef in Texas has gone up nearly 47% since the early days of Trump’s second term, while eggs cost $3.19 more than they did before Trump took office.
In California, eggs now cost over $5.00 more than they did before Trump’s second term, based on “historical trends, real-time supplier data, and market analysis” that Unrig Our Economy examined.
Trump & congressional Republicans claim that food prices will come down.
While they raise prices – we pay.
🚨So we built a brand-new site to hold them accountable:https://t.co/h3lVqz2Z6A tracks food prices in real time — and exposes how the GOP's policies are raising costs. pic.twitter.com/YKvzMV683Z
— Unrig Our Economy (@UnrigOurEconomy) July 31, 2025
Unrig Our Economy gained some of its data from Kroger’s pricing data, finding that in states with Kroger stores, the price of beef has gone up between 16% and 72%, with the biggest price hikes in Alaska and Utah.
Egg prices in particular were a talking point for Trump during his presidential campaign, but they’ve risen in many states where Kroger operates, with customers in Michigan—where the president won in 2024—paying 58% more for eggs.
“Trump and Republicans in Congress are singlehandedly inflating the cost of everyday items that Americans rely on,” said Leor Tal, campaign director for Unrig Our Economy. “While billionaires and corporations cash in on Republican-backed tax breaks, working-class families are left paying higher prices for eggs, coffee, and more.”
Unrig Our Economy pointed to reporting on Trump’s tariffs, more of which are set to be announced Friday, with the president expected to impose rates up to 50% on some imports.
As Common Dreams reported this week, the advocacy group Groundwork Collaborative found that just as corporate executives used labor shortages and supply chain disruptions during the coronavirus pandemic as cover to keep prices high even after those problems were resolved, many are now using tariffs as a justification for price increases.
“We certainly welcome a reduction in the Chinese tariffs, but we’ll be announcing a price increase here regardless of any changes of the Chinese tariffs over the next week or two to go into effect in June,” the CEO of one footwear brand said in a recent earnings call.
Unrig Our Economy pointed to recent polling that showed Americans overwhelmingly disapprove of Trump’s tariffs, including 47% of Republican voters.
The Trump administration has also made a number of regulatory moves benefiting corporations that aim to take as much money from working families’ household budgets as possible, including a push for the cancellation of a Biden-era Federal Trade Commission rule allowing consumers to easily cancel subscriptions; the FTC’s decision to drop a lawsuit challenging price discrimination by PepsiCo; and the commission’s move shutting down public comments on corporate pricing tactics.
The interactive tool was unveiled weeks after the president signed into law his sweeping domestic policy and budget package, which includes the largest cuts to public programs like Medicaid and the Supplemental Nutrition Assistance Program in history, increases monthly payments for student loan borrowers under repayment assistance plans, and hands out $117 billion in tax cuts to the richest 1% of Americans while providing just $77 billion in cumulative savings to the bottom 60% of earners.
As Unrig Our Economy unveiled its tool allowing Americans to see exactly how their household budgets are being impacted under the Trump administration, the Century Foundation (TCF) and Morning Consult released the results of a poll in which they asked more than 2,000 people in June how they were being affected by the high cost of living over the past six months.
More than half of respondents said “billionaires, corporations, and congressional Republicans have made their lives harder,” and 60% said the Trump administration is to blame for the higher cost of living.
More than 4 in 5 Americans said they were concerned about the price of groceries, and nearly half were concerned about their ability to pay their rent or mortgage. Forty-eight percent said they would have difficulty paying an unexpected $500 bill, like a home repair or medical bill, without borrowing or using credit, and nearly 20% said it would be “very difficult” to make the payment.
Even among households with incomes over $100,000, more than a third said they would have a hard time meeting the surprise expense without dipping into savings or using credit cards—suggesting that these households are using a large proportion of their relatively comfortable monthly income for essentials
“While the federal government tears down programs such as Medicaid and food assistance and federal regulators give the green light to companies to rip off consumers, families are being forced to construct their own safety nets from a web of risky financial practices,” said TCF.
Unrig the Economy said that with Don’t Inflate Our Plates, the group is calling out “the Republican-backed policies that got us here” and demanding “that Congress put working people first.”
Saw an article in the last couple of days warning that Social Security Staffing cuts might threaten Cost-of-Living Adjustments- no one there to analyze infaltion. Someone commented that there was plenty of data available everywhere.
This looks interesting.
Bill Maher, the Nobel Prize winning economist, declared he was wrong about the inflationary effects of Trump’s tariffs.
The effort and study into Maher’s advanced degrees must have displaced the simple Econ 101 exhortations about lagging effects of policies on the real economy.
A small additional point for Mr. Maher:
the economy is NOT the Stock Market and the three major Indices reported breathlessly every night on Broadcast news.
I’m sorry but Common Dreams is mostly apology for the D faction – it’s all the bad ol’ Rs. They are proponents of the Bipartisan status quo. The D faction has done nothing but vote for kleptocracy, anti-labor, pro-finance, genocide, war and everyone turns a blind eye to the rampant institutional corruption in both the so-called public and private sectors.
“… More than half of respondents said “billionaires, corporations, and congressional Republicans have made their lives harder,” and 60% said the Trump administration is to blame for the higher cost of living…”
So whaddya gonna do? Vote D? Arrghh The same old garbage for decades got us where we are now.
The US is an oligarchy, let’s stop pretending otherwise, the charades have become tiresome and irritating. The judicial branch make a mockery of the law and the constitution, the legislative branch are openly and legally bribed, and the Idiot Emperor and the Kakistocrat Krew are accelerating the rot.
Also, when are folks going to see that the Emperor has lost his marbles? Dude is showing signs of physical and mental decline. Even the so-called liberal outlets don’t see it.
I guess late-stage empire produces deep corruption, kleptocracy, corruption, kakistocracy and war.
Don’t need to say “so-called liberal” as liberal is an enforcer of the status quo as well as being Far-right wing.
This is ad hominem and a violation of our site Policies.
You don’t disprove the validity of the remark.
And inequality and immiseration of the poor is increasing enormously under Trump.
No, it was an attack on the credibility of Common Dreams. As in, if the witness is unreliable, that is grounds to doubt the testimony. Ad hominem is an attack on the messenger unrelated to the message. Credibility, however, is always relevant.
Jeez Louise, you fail as a pedant.
No, ad hominem is not about testimony. It is the logical fallacy of trying to dispute the validity of an argument by attacking the party that said it. You might try using the modern invention of a search engine rather than tout your erroneous beliefs.
https://en.wikipedia.org/wiki/Ad_hominem
Your comment about credibility is also false. Even parties with erratic track records can make accurate observations. That is why you must address the argument on its merits.
That’s right. The Democratic Party knows that all it has to do to regain power is wait for Trump to self-destruct. They have no intention of creating plans that would improve the lives of ordinary people.
JonnyJames is also wrong in his depiction of Common Dreams. They are Sandernistas. They have often criticized Team D from the soft left.
‘Republicans against Trump
@RpsAgainstTrump
Brazil is the largest exporter of coffee to the U.S.
With Trump’s 50% tariffs on Brazilian imports, your coffee is about to get a lot more expensive. (Prices have already jumped over 15% in recent months.) All because he wants to protect his corrupt friend Bolsonaro. Insane.’
The whole thing is asinine but I wonder if Washington will privately agree to look the other way if, for example, Brazilian coffee was shipped to say Mexico who then sold it to the US for a marked up price. If there was a mini-revolt over the price of coffee, the Trump regime might think it wise to go this way to take some off the pressure form these price increases. And this could happen for other goods as well. Trouble is his admin is shot through with ideologues who might rebel at the idea.
“If there was a mini-revolt over the price of coffee…”
As one NC commenter recently stated, “Coffee is not a matter of life or death, it’s much more important than that.”
Also see Michael Pollan on caffeine and capitalism: https://www.youtube.com/watch?v=IHW7Ly8k0X8&t=7s
Might one then infer that a lack of caffeine will bring about socialism, inefficiencies due to acquiescent lassitude, something else entirely?
Does the price of eggs have anything to do with tariffs, or just with bird flu and the culling of birds?
I’ve no doubt the tariffs will have significant impact, but the eggs are one of the only concrete [ie non-political] statistics in the linked article.
TOM: A google search found the USA is importing eggs from Turkey and South Korea. Other sources being considered include Europe and Brazil.
It is difficult to imagine large eggs being more than $5 doz anywhere in the USA, but well, California is “special”. Before Covid they were 49¢ per doz here. But for a few weeks now (in Wisconsin) they have been holding at $2.71 at Aldi (and I think that is high).
Where are policy proposals that stand a chance of enactment to reverse the rise in interest costs?
What will those mean to you, me and our friends, neighbors and everybody?
After absorbing increase in premiums on auto insurance and housing insurance, I’m waiting patiently on the retrospective analysis of what Did Happen the last four years between mid year 2021 to January 2025. This isn’t what about the other side necessarily but clowns like a Krugman or Noah Smith were crowing loud and proud on the wonders by those Biden administration economic policies. Mainstream economists deserve their scorn and this cheerleading is readily available to find from previous years.
My last six month auto premium finally flattened out, or unchanged. Year to date the average price on a gallon of gas is practically unchanged as well. Feel welcome to highlight items that have increased or will be increasing in that basket of theoretical groceries for a family of four. But personally my personal cost of living increased by roughly 25% to 35% during that aforementioned time frame until early 2025.
The cost of natural gas from PG&E went up about 40 percent in the last year. Locally grown organic eggs are still around $10 per dozen. That’s down from $12 from a few months ago. Our auto insurance premium actually went down a whopping $1.66 per month. Alas, our business work van with tools of the trade was recently stolen, so if Farmer’s runs true to form they’ll get back their buck sixty-six and a whole lot more come renewal time. Trade van thefts are rampant here no doubt due to harder economic times, and our town seems able to afford only 1 police officer per 10,000 residents, which is 1/3 the national average. Good times!
Forgot to add, our city’s parsimony when it comes to citizen security services is rather baffling in that we are hardly a community of poors, over the last few years under state pressure we’ve added thousands of new residential units, and our state and local taxes are some of the highest in the nation.
PG&E, aren’t they a notorious and poorly run energy utilities company on the west coast I wish to suggest? I don’t do organic anything to be honest, so the best of my egg purchases in a convenient dozen currently run about $3 per dozen for a store branded carton. My personal experience is just that, of course within my daily or monthly consumption patterns. A simple anecdote from a supposedly “Simple Man!”
We went from high times under Biden and just now people ( not specifically to you or anyone here ) recognize the cost of living increased dramatically since 2021….oh come on. Would a Harris administration really have made marked improvements or changes in a few short months? I think, in that hypothetical , most media would’ve extended a grace period but that is just me being a cynical American citizen.
I had 3 Bidenomics sightings yesterday, people walking on the road in this rural area where if you’re doing that, you’re in a bad way. What looked like a couple and two individuals.
I got lucky with auto insurance this go around, the price went down slight; and I negotiated a better deal with Spectrum, to my shock, sans TV bundle. Just Internet-only now, and for about $16 less per month. I was shocked.
Things were deteriorating even prior to our surprise jobs number today.
I’m an owner of a thirty year old wholesale specialty food and spice business. We import and then manufacture, package items you cannot get onshore, or often times, spices etc that literally cannot be grown here. Yet these inputs are being tariffed seemingly with zero thought, foresight, planning. It’s the whim of the king and whether someone was mean to his bestie decision making.
But small businesses like mine have very little runway to get through this environment. Everyone I know is getting more convinced (perhaps a bit of wish casting) that the courts will strike down the tariffs. They have already lost in US Trade Court by unanimous decision. The US Appeals Court yesterday seemed very skeptical of the governments position. I expect the decision to be the same as the Trade Court. SCOTUS? Not so sure. And how long must we wait?
Or if the decision ultimately doesn’t go his way, will he even abide by it?
In the meantime the admin is blowing up businesses, jobs, inflation. I see it up close everyday.
“Yet these inputs are being tariffed seemingly with zero thought, foresight, planning.”
You’re dead wrong: it’s a great big beautiful plan and you and I ain’t in it.
Hey, us not being in, IS the plan.
Saw a published US unemployment stat for the last quarter that youth unemployment had risen from 9.2% to 10%, which qualifies the headline rate.
Trump didn’t like todays jobs report so he fired the head of the Bureau of Labor Statistics Erika McEntarfer.
https://www.nbcnews.com/business/economy/trump-orders-firing-bls-commissioner-weak-jobs-report-rcna222531
I struggle to visualize what is the outcome Trump and his cronies expect from this. Tariffs are only a good threat so long as the US market is good; now, 342 million people is nothing to scoff at, but as immiseration sets apace and companies are forced to diversify buyers (after all, the only reliable expectations scenario for Trump is that he does things on a dime and can cause ruinous losses based on whims) how relevant will the US market keep on being?
Furthermore, in a pure balance-of-payments matter, the US dollar as the global means of payment, store of value, etc. necessitates US deficits, as is well known. The attempt (meagre as it may be) to induce surpluses would imply catastrophic deflation, as too few dollars are available for world investment/commerce needs, and the obvious impossibility to industrialize (I don’t expect Trump and his ilk to follow the Credit Theory of Money, though). On the other hand, the deflationary pressures could well make everyone who is holding treasuries and the like to cash out in order to benefit from the currency arbitrage, causing raising yields, an incapability to refinance the US debts, and stock and commodity prices to soar (since the dollars would have to be put somewhere that isn’t more US treasuries). Any way out of this dilemma that I can see is to cause either inflationary ruin or bankruptcy (and maybe both). Is there anyone thinking of the consequences?
I suspect that people are underestimating the economic cliff dead ahead due to the front-loading of US imports (to avoid tariffs).
The front-loading both delayed and will soon enhance the effects of the tariffs on PRICES and REAL ACTIVITY and TRADE.
Now that 18% average US tariffs are permanent, US imports will not only decrease in an amount consistent with an increase in the average tariff from 2.3% to 18%, US imports will also decrease an even larger amount to make up for the excess inventories that were previously imported to front run the increased tariffs.
This sudden tremendous decrease in US imports will sharply decrease global real activity in the second half of 2025.
Similarly US businesses will go from having abundant low-cost front-loaded inventories to suddenly having scarce high-cost inventories. Prices will increase dramatically and rapidly in the US in the second half, even as global GDP plummets.
Data point: 3-4 months ago I paid $13.99 for a 2.5 pound bag of Costco’s French roast whole coffee beans. The following month it was $116.99, and ten days ago I paid $19.99. Regardless of the beans’ origin that is a coffee Brazilian.
I’m assuming you mean $16.99 not $169.99.
I just read this article right before your comment, coincidentally: https://www.barchart.com/story/news/33822282/coffee-prices-plunge-as-supply-concerns-ease
I don’t see how the price action downwards makes sense on the tariff exemption news? It was caused by a lack of supply due to environmental factors. A reduction in tariffs would only increase US consumption of it. Ive been talking to a lot of coffee roasters recently and one mentioned that Robusta will likely come back into favour as Arabica becomes harder to grow due to climate change. He mentioned that Arabica became the popular bean partly because it was seen as a “premium” bean in the first place. Anecdotally, my friend recently brought back some Robusta from Vietnam and it had amazing flavour. I feel like it’s underrated, at least here in Canada.
Oops! You are correct. It was $16.99.