Jared Bernstein on Tariffs: It’s Not a Matter of When This Consumer Pass Through Will Occur, We’re Already Seeing It

EXCERPT:

BERNSTEIN: "When goods arrive in this country, imported goods arrive in this country, the tax or the tariff on those goods is paid by the importer, by the American company that imports those goods. That’s the first so-called incidence of the tariff. Then you go down the chain. So it’s importers, wholesalers, retailers, and standing at the end of that line is the American consumer. And just as we just heard from Jen, a lot of those people who voted for Trump did so because they believed he was going to lower prices. It’s not a matter of when this consumer passthrough will occur. We are now seeing it. We’re seeing it at the company level through lower profits, and that’s corporations eating some of the tariff. But that can only go on for so long. They can only let their profit margins get squeezed for so long. They’re already working through their buffers on their inventories, where they front loaded to try to avoid the tariffs. We are now unequivocally seeing tariffs pass through to consumer prices. We’re seeing it in furniture, toys. We’re seeing it in apparel. We’re seeing it in electronics, and we're just going to see more of that as time goes forward."