Story perspectives

Trump's Tariffs Fail to Dampen Economy Amid AI Boom

2/5/2026

44 6

Summary

Story summary

U.S. President Donald Trump’s tariffs have not caused the expected downturn.
Economists credit resilience to robust spending on artificial intelligence and government investments.
The tariff rate has fallen from 28% to 17%, while inflation stays below 2022 highs.
Some experts warn the muted tariff impact may change as importers cannot absorb costs without raising prices.
Public opinion on tariffs is negative, with many Americans believing they raise prices.

History

Historical Context

The Smoot-Hawley Tariff Act, signed by President Hoover on June 17, 1930, raised U.S. tariffs to an average of 20%, provoking retaliatory measures from trading partners and contributing to a 67% decline in international trade during the Great Depression. While recent tariffs under President Trump have decreased, public sentiment remains wary, reflecting historical concerns about tariffs raising consumer prices and harming economic stability.

1 of 2

Story summary

U.S. President Donald Trump’s tariffs have not caused the expected downturn.
Economists credit resilience to robust spending on artificial intelligence and government investments.
The tariff rate has fallen from 28% to 17%, while inflation stays below 2022 highs.
Some experts warn the muted tariff impact may change as importers cannot absorb costs without raising prices.
Public opinion on tariffs is negative, with many Americans believing they raise prices.

1 / 2