Weekend Edition: Trump’s Winners and Losers
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What are the main winners and losers of Trump’s tariff policy in the United States?
There's the big beautiful bill and then there are the tariffs. Who are the winners and losers within America, but also economies around the world? And where does it all end? Let's get some perspective from one economist living in Washington who's been there and done it all. Phil Suttle joins me today.
The weekend
edition. So who are the winners and losers from Trump's tariff policy so far? And uh also, you know, in whatever form it ultimately takes, and it's anyone's guess as to where it's gonna end up. Well, Phil Suttle is a UK born economist. He went to Oxford, worked for the Bank of England in the early eighties, went uh to the Institute of International Finance in Washington, DC, spent many years with JP Morgan, sometime at the Fed as well and Barclays, and now he's running his own ecosystem. Economics business, subtle economics. He's got a daily newsletter and heap heaps of other research as well for people just like us. And of course, Phil, you've been watching closely the uh the impact of Donald Trump's fiscal policy.
How can you not the tariffs, the big, beautiful bill, uh the spending, and the winners and losers in all of this. So um one loser is is uh the small African nation of Lesotho who declared a state of national emergency at the prospect of these tariffs at fifty percent, a country that no one's ever heard of. Here's how Donald Trump described them. But you know what? When you've got high tariffs on low value goods, so they m maybe sell a jumper to to the United States for five dollars, so if that got taxed at two dollars fifty, but it's getting sold at forty or fifty dollars, th then Yeah. can easily take the squeezing their margins on that, wouldn't they? I mean, so the low value goods surely are uh even though the percentage might be high, the impact isn't going to be huge, is it?
Yeah, I I think you're right. Uh I mean obviously you can do arithmetic however you want. Uh although, you know, lots of small changes to small things, if you do enough of them accumulate to something a bit bigger, uh putting it bluntly. You know, we we we we've obviously going through various swings on sentiment, on the impacts of tariffs, both on growth and on inflation. Um, and you know uh to begin with, there was a view, well, this was all trivial because he wouldn't do very much. Then in April it was, Oh my God, he's gonna do a lot. This is gonna be huge. Uh and then, you know, the the famous taco effect kicked in and he chickened out particular and this is the really important thing in in terms of t tariffs on China, um and and and actions on China.
Um and now of course we're back in a in a world where you know, the sus the suspension, which took three months between April ninth and July ninth, is now sort of being crystallized in a more potentially more more durable set of tariff rates being levered across countries. Net net, you know, you're looking at a something like a fifteen to seventeen percentage point rise. in the effective US tariff rate on its own. But
do we know how how you know, just as I gave that example, if you've got l because it does depend, doesn't it, on the value of those goods themselves. You've got a lot of low value goods, which is why I started with a Lesotho. You've got a lot of low value goods that have got high margins. It's it's less important than if you've got higher value goods with lower margins. And do we get do we get a feel for what the mix of that is?
No very good question. And I guess the short answer is I can't give you precise uh uh estimates, but you know, take an auto. Yeah, one of the most explicit com uh uh tariffs in Nevit so far, it's been twenty five percent on enforced automobiles. And there you're dealing with a high value relatively low margin product. So You will see two things happening. One, you will see the price of imported cars and imported car components going up. Uh, and two, uh, you'll see a greater profitability uh for making cars in the United States versus you know, making them in Germany or Japan and exporting them to the United States.
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Chapters
8 chapters
1
What are the main winners and losers of Trump’s tariff policy in the United States?
0:01–4:09
2
How do high tariffs on low‑value goods affect small economies like Lesotho?
4:09–8:25
3
Why might the U.S. auto industry see higher prices but lower profitability under the tariffs?
8:25–12:44
4
What does the “taco effect” reveal about the volatility of Trump’s trade policy?
12:44–17:04
5
How are Europe and Germany adjusting to potential U.S. tariff escalations?
17:04–21:05
6
Will the shift in global trade patterns caused by Trump become permanent or revert after he leaves office?
21:05–25:35
7
How are U.S. consumer savings and labor‑force trends influencing demand amid tariff uncertainty?
25:35–29:23
8
What long‑term impact could Trump’s protectionist agenda have on global investment and growth?
29:23–32:03