How Economists’ Central Anti-Tariff Prediction Collapsed

In yesterday’s Breitbart Business Digest, we examined a new working paper from Jared Bernstein and Daniel Posthumus that documented the decline of U.S. manufacturing employment, particularly the devastating 2000-2010 “China Shock” period when 5.7 million factory jobs disappeared.

While the authors called this period “destructive” and urged preventing future shocks, they insisted that “sweeping” tariffs were not the right policy. Their reasoning was undermined by a significant contradiction: they claim tariffs would disrupt American manufacturing because we’re too dependent on foreign inputs, yet they simultaneously advocate for subsidies for sectors vulnerable to foreign export controls. They’ve essentially documented that our industrial base is dangerously hollowed out while arguing we’re too dependent to fix it.

As we explained, the real-world evidence further undermines their anti-tariff position. Despite President Donald Trump’s sweeping tariffs imposed in April 2025, the predicted “tarifflation” never materialized. Prices on tariffed imports haven’t risen as economists predicted. In fact, prices on non-tariffed domestic goods rose more than tariffed imports, while domestic goods competing with tariffed imports are actually down since Liberation Day. There certainly has not been any widespread inflation created by tariffs.