Tyler Schipper

In the News: Tyler Schipper Explains How Tariffs Affect Americans

University of St. Thomas Associate Professor of Economics Tyler Schipper appeared on KARE 11’s “KARE to Explain” to discuss the real-world impact of tariffs and why Americans – especially consumers – end up footing the bill.

From the interview:

Tariffs, often discussed in the context of international trade or political maneuvering, are ultimately taxes on goods that come into the U.S. But the burden doesn’t stop at the border.

“A tariff is a tax on American companies that import goods,” said Schipper. “So, if we tax the companies that bring stuff into the country, the cost goes up, and that cost usually gets passed down the chain – eventually to consumers.”

Schipper emphasized that while the political messaging around tariffs might sound like they’re targeting foreign governments, in practice, Americans feel the pinch through higher prices.

“There’s this idea that ‘we’re making China pay,’ but that’s just not how tariffs work,” Schipper said. “It’s American businesses paying, and then American consumers.”

Tariffs have been levied in waves, often with shifting targets and rates. While they can be used to protect domestic industries – such as steel or semiconductors – Schipper warned that broader applications of tariffs can have unintended ripple effects across the economy.

“When businesses face uncertainty – especially small and mid-sized ones – they may delay investments or hiring,” he said. “And that can have a real impact on growth.”

Schipper also touched on the strategic reasoning behind some tariffs, particularly those aimed at China. While acknowledging the need to address issues like intellectual property theft and forced labor, he stressed that most economists overwhelmingly oppose broad tariffs as a tool of economic policy.

“There are legitimate concerns, and in some cases, targeted tariffs may be justified,” said Schipper. “But we need to be honest about who pays for them.”