Due to President Donald Trump’s tariff war on China, the U.S. economy faces some serious concerns. The World Trade Organization warns that global trade in goods could fall by 1.5% in 2025, which would make it only the sixth time in the past sixty years that global trade has gone down, the former being during Covid. Additionally, if President Trump fulfills his promise to introduce more tariffs in July, we can expect global trade to drop even more.
As of 2024, the U.S. has imported over $438.9 billion worth of goods from China.
Everyday goods we use—such as clothing, phones, electronics, kitchen appliances, toys, furniture, batteries, and sports equipment—are imported from China.
Because of the most recent 145% tariff on Chinese goods and high duty costs, importing these goods has become more expensive, becoming the main reason why many businesses are currently choosing not to import. The businesses that are still importing will need to increase the prices of these goods, which will likely cause consumer demand to fall.
Less importing will trigger everyday goods to cost more and may become harder to find. Therefore, as goods become more expensive, consumers will likely pull back on spending, and businesses that rely on imported goods will struggle to stay afloat. Many companies may go out of business, and those that don’t may experience slower production, and workers will lose their jobs. Therefore, not only will high tariffs drastically hurt the economy, but also the everyday lives of Americans.
The Port of Los Angeles, handling the most TEUs in the U.S., is affected by the tariffs most of all.
Being the largest importer of all the states, California handles about 40% of the country’s imported goods.
In response to the tariffs, California has filed a lawsuit against the Trump Administration, with claims that President Donald Trump is abusing his power by causing financial harm to California as well as the U.S. economy. The lawsuit states that tariffs have already caused major damage to the economy by crashing markets and risking a recession.
Also arguably, only Congress has the power to impose tariffs and not the president. California’s lawsuit disputes that the law that President Trump used (IEEPA) is only meant for emergencies and not trade taxes. However, President Donald Trump argues that this is considered a national emergency. His reasoning being that American businesses are relying too much on foreign countries, and that tariffs are needed to protect them.
Unsurprisingly, California is not the first state to sue the administration. The Trump Administration are facing similar lawsuits regarding tariffs in three other states: New York, Florida, and Montana. Can we expect more?
