What Tax Cuts Giveth, Tariffs Taketh Away for U.S. ConsumersBy
U.S. consumer sentiment just soared to the highest level since 2004 amid paycheck-boosting tax cuts. But other government policies aren’t so popular.
Americans’ optimism about current economic conditions rose to a record in March, according to preliminary figures from the University of Michigan released Friday. At the same time, President Donald Trump’s tariffs on imported steel and aluminum tempered the economic outlook and spurred expectations for higher prices, the report showed.
“I can imagine, if I went out and asked anyone how they felt about the tariffs, I might expect that answer: People just have a sense that tariffs are a lack of free trade and it’s going to raise prices,” Steve Gallagher, chief U.S. economist at Societe Generale, said by phone from New York. More Americans are hurt than helped by the tariffs, he said, but the actual impact of the tariffs on inflation and the economy will be minor.
Of consumers who heard news about recent economic changes, about 30 percent viewed the tax changes in a positive light, while roughly the same share had negative feelings toward the tariffs, according to the Michigan report. A fifth of Americans surveyed even said they favor buying items in advance of inflation, the highest level since 1990.
The president’s trade officials are finalizing a 10 percent charge on imported aluminum and 25 percent on steel which take effect this month, while deciding which countries in addition to Canada and Mexico will be exempt.