Hellfire Economics: The Devil's Playground of President Trump's Tariff Policy
Soaring Concerns Among Businesses Precede Trump's Upcoming Tariff Declarations Dubbed as "Liberation Day"
In the dicey world of politics and economics, President Donald Trump has set ablaze a dynamic tariff policy that's making waves in the business community. Labeled by many as unpredictable, Trump's presidency has seen a flurry of tariff Twisters, with the commander-in-chief seemingly toggling them on and off at will.
His latest move is a jaw-dropping, across-the-board reciprocal tariffs declaration slated for April 1, a day he's dubbed "Liberation Day." Preaching on his Truth Social platform that foreign countries have been gleefully taking advantage of America, Trump promises that his tariff announcements will bring manufacturing back to the states, making America more self-reliant than ever.
Business on Edge
Corporate jitters about tariffs are turning up in economic indicators left and right. Business leaders are vocal about their frustrations, complaining that the unpredictable shifts are making it difficult to see straight when it comes to long-term planning.
Trouble Ahead, According to the Numbers
Corporate concerns about upcoming tariffs have cropped up in numerous surveys, including:
- Lehigh Business Supply Chain Risk Management Index
- Our website readership polls
- S&P Global Ratings
- Institute of Supply Management (ISM) surveys
According to the Lehigh Business Supply Chain Risk Management Index (LRMI), businesses expect significantly higher risk to their supply chains in Q2. The average risk score across all categories reached an all-time high of 72.14, the highest recorded in the last four years. Nine out of ten categories showed an increase in perceived risk for Q2.
Supplier Risk took the lead and reached an record high of 87.50, noted in the report as a consequence of the unpredictability of tariffs and their effects on suppliers and supply chains. "Four years ago, we sourced 60% of our product from China. By the end of this year, that number will be less than 5% thanks to tariffs and geopolitical issues," wrote one respondent.
Government Intervention Risk also showed up high on the LRMI report, with a score of 80.52. Trump's inconsistent strategy so far has business bigwigs scratching their heads, trying to figure out how to keep up. "So far, there seems to be a weird on-again, off-again posturing regarding which tariffs take effect with which partners, on what commodities, and when these would take effect," writes one respondent. "If only there were clear ground rules to follow and we stuck with 'em, at least then we would know how to adapt our supply chains to this global trade madness."
The sentiment is echoed in the responses to our website poll surrounding tariffs: "Not so concerned about tariffs themselves, but, more concerned about how they are implemented. There doesn't seem to be a consistent theme. Also, worried about how the current strategy seems to be adversarial to some of the U.S.'s best trading partners."
Pain Already Being Felt
Although the "Liberation Day" tariffs haven't been officially announced, they're already doing some serious damage. "The threat of tariffs and the international issues being caused by the current political leadership is making it more difficult and costly to get repair parts and machinery," wrote an LRMI respondent.
Despite the challenges already cropping up, businesses are having a tough time planning thanks to the lack of transparency surrounding the tariffs. "Most of the companies we work with are putting a hold on any major projects until after April 1. They're waiting for some clarity," writes one our website respondent.
Punching the Economy in the Gut
The tariffs are also poised to take a chunk out of the overall economy and wallets. "Tariffs imposed or floated by the U.S. and countermeasures by other countries are quickening at a rapid pace in 2025. This has weakened investor sentiment, consumer confidence, and should weigh heavily on economic growth this year," according to S&P Global Ratings' Global Credit Conditions Q2 2025: Total Carnage Ahead. "In addition, global alliances and multinational institutions are being torn asunder. The fundamental geopolitical shifts underway are likely to result in substantial shifts in capital flows between regions, sectors, and asset classes."
There's widespread concern about the state of the economy, and it's not getting any better with Trump's proposed tariff strategy. "Multiple economic risks are skyrocketing with deportations, border delays, tariffs, and extreme cuts to many critical government departments," writes an LRMI respondent. "Also, inflation is ticking higher every month, and if Trump continues with major broad tariffs, we can expect this trend to continue."
If a significant portion of manufacturing operations moves to the U.S. (one of Trump's pet projects), that doesn't mean manufacturers are out of the woods. LRMI respondents voice concerns about price volatility and labor shortages if industry operations are onshored.
"Tariffs will cause much long-term disruption, as suppliers and customers alike will have to navigate these new price structures," writes an LRMI respondent.
"Customer Risk" reached a score of 75.63 on the LRMI Q2 report. "I expect that tariffs will drive up prices and suppress growth. The uncertainty about the next move from the administration will also make the business climate very tense," writes a respondent.
Consumers Gotta Pay
Consumer behavior, the loss of business, and the need to pass costs along to customers are a prevailing concern among respondents. "Tariff announcements have sparked a surge of RFQs as our customers try to stay ahead of the issue. We'll do our best to support our key customers with tariff-free materials as long as we can. But at some point, we're going to be forced to pass the full tariff on to our customers," writes an our website respondent.
In some cases, companies have already been forced to pass the cost along, with one our website respondent writing, "We're planning to hike prices to minimize the damage to our margins, and in some instances, we've already been passing through raw material increases."
In addition to higher prices, other issues stemming from tariffs may hammer inflation and the global economy. "The anticipated Trump Administration tariffs have arrived, but they're far from concrete, leading to protectionist measures by other countries and increased market volatility," notes the S&P Global Ratings report. "If current tariff levels persist or increase further, we would expect an exponential strain on consumer sentiment, business planning, investments, and government budgets. The result would be a significant reduction in our already precarious expectations for global growth this year."
- The tariffs announced by President Trump are causing confusion in the business community as they shift unpredictably, making it difficult for businesses to develop long-term strategies.
- According to the Lehigh Business Supply Chain Risk Management Index (LRMI), businesses anticipate a significant increase in risk to their supply chains in Q2 due to the unpredictability of tariffs.
- Corporate concerns about upcoming tariffs have been voiced in various surveys, such as S&P Global Ratings, Institute of Supply Management (ISM) surveys, and polls on our website.
- The tariffs proposed by President Trump are expected to take a toll on the overall economy and consumer wallets, with S&P Global Ratings predicting they will weaken investor sentiment, consumer confidence, and economic growth.
