Even though the 145% tariff on Chinese imports only lasted a month, it already inflicted its scars on the economy. Global trade is just not something you can turn off and on like that. Some companies got really unlucky. Like those whose goods arrived at U.S. ports before the pause. If a medium size company had a million dollars worth of goods imported, they had to pay an extra million and a half dollars on top of that – just for the tariff. Today we are bringing you a portrait of this unfathomably high tariff. What a month of 145% tariffs looked like and felt like for three people in the global economy whose lives were all affected and still will be. The ones who got lucky and the ones who got really unlucky. This episode of Planet Money was produced by Emma Peaslee and edited by Jess Jiang. It was engineered by Jimmy Keeley and fact-checked by Willa Rubin. Alex Goldmark is our executive producer. Check out the live cargo map here. Find more Planet Money: Facebook / Instagram / TikTok / Our weekly Newsletter. Listen free at these links: Apple Podcasts, Spotify, the NPR app or anywhere you get podcasts. Help support Planet Money and hear our bonus episodes by subscribing to Planet Money+ in Apple Podcasts or at plus.npr.org/planetmoney. Music: NPR Source Audio - "Bass Talks," "Bassline Motion," and "What Da Funk"Learn more about sponsor message choices: podcastchoices.com/adchoicesNPR Privacy Policy
Chapter 1: What did the 145% tariff on Chinese imports entail?
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The first ships with the 145% tariffed goods from China had just started pooling into U.S. ports last week when, just a few days later, the U.S. announced that that mind-bendingly high tariff was now gone, paused. The U.S. and China agreed to temporarily bring the tariff way, way, way back down from 145% on most Chinese imports to 30%.
though the tariff on things like cars and steel and aluminum is higher, about 50%. And, you know, the deal came pretty quickly after talks in Geneva, and it was maybe unexpected or maybe not at all unexpected because the 145% tariff on China and China's retaliatory tariff on the U.S. was already threatening a global recession.
And in all the tit-for-tat back and forth, some companies caught really hard. unlucky, like those whose goods arrived at U.S. ports before the pause. If a medium-sized company had a million dollars worth of goods imported, they had to pay an extra million and a half dollars on top of that just in the tariff.
And had their ships arrived, like, a day later, their bill would be punched to the gut so much less. And even though this unprecedented tariff only lasted a month, it already inflicted its scars on the economy. Today on the show, what a month of 145% tariffs looked like and felt like for three people in the global economy whose lives were all affected and still will be.
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Chapter 2: How did the tariff impact U.S. ports?
We'll start at the biggest port in the Western Hemisphere. Yes, hi. Nice to meet you. Oh, in a suit at the port on a 93-degree day. This is the uniform. Well, when you run the port, yeah, that's the uniform. Gene Sirocco runs the Port of Los Angeles, an 45% of everything that comes into this port is from China.
So half, half of the business. Half of the business.
When we met up, the big, scary 145% tariff was still in place. Are you, like, stressed? Are you doing okay? How are you feeling?
I'm doing okay, but I am concerned.
Jean and I are at one of the seven terminals at this port where the cargo ships pull in to get unloaded. Like where those giant cranes lift the big steel shipping containers off the ship and like stack them on the dock. That's where we're at, at the Evergreen Marine Terminal.
Today, there are nine cranes and their booms are all up. There's not a ship at the Evergreen facility today.
Are you expecting one today at this terminal? Not today. And no ships earlier today. There hasn't been any today.
This is a huge void. So if there's anything that's emblematic of where we stand right now with international trade, it's the fact that there are no container ships at one of our most famous terminals, Evergreen Marine.
When there is a ship here, how long is it here?
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Chapter 3: Who were the key people affected by the tariff?
And when there are high tariffs, there's an incentive to shift even more production to those lower tariffed countries.
Shipping components from China to another country. assembling those through a process that's called substantial transformation, which means you transform it to now it's a made in Vietnam product. Perfectly legal.
You may have heard a Planet Money episode about this recently.
And then it ships from Vietnam to the U.S. So from a logistics standpoint, you just ship the same thing twice. Once from China to Vietnam and then once from Vietnam.
Oh, so that's good for you.
Trade might actually go up at all of this.
Not like trade for the U.S. necessarily, which is like global trade.
Global trade movements.
Things will just be moving around. And now, now that the Trump administration has backed off of the 145% tariff and agreed to a 30% tariff for 90 days, well, now Ryan is expecting a ton of demand during those 90 days as businesses rush to ship out goods at the lower tariff rate. After the pause was announced, bookings from China to the U.S.
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