Whiplash Guaranteed?

“Life can be a boomerang. Whatever

you throw out there may just return

to you. If you don’t like what comes

back, it is time to change the input.”

— Anonymous

Every time you point a finger at anyone in scorn, three remaining fingers point right back at you, says a Native American maxim. Native Americans may be few and far between in today’s changed world, but the wisdom of their ancient proverb is quite alive. It has risen from the ashes to hit the US where it hurts the most – business and economy. Barely 55 days after President Donald Trump announced a new tariff structure for trade with the world, the repercussions have been reverberating across the global economy, and America itself has not been spared either.

From retail giants to tech titans, agriculture to tourism, automobiles to fast food chains, and vineyards to cab companies, the fallout is undeniable and so bloody that it is impossible to sweep under a rug. The aggressive US stance has ignited a firestorm of economic challenges, plunging businesses into uncertainty and leaving domestic consumers grappling with rising costs, disrupted supply chains, and essential goods and services.

Be it hypermarkets and retail chains such as Walmart or Home Depot; online retailers like Amazon or Apple; auto firms such as General Motors, Ford Motor or Stellantis; food giants like McDonald’s, Burger King or Subway; coffee chains such as Starbucks, Dunkin’ Donus or Tim Hortons; agriculture equipment suppliers such like John Deere or CNH Industrial; vineyards like Napa Valley or Sonoma – all are living the nightmare of high procurement costs threatening closure of operations. Worse, the list above is only indicative, and all segments of public- or corporate-facing business are feeling the domestic impact of the tariffs on home turf itself.

Projections in the Gutter

Business projections have gone into the tariff gutter, along with people’s pots, pans and monkey wrenches. Even with a ‘tariff pause’ of 90 days for much of the world, arch rival China remains in the crosshairs, powering a business tsunami that is obliterating everything in its path. We have not even talked of tourism yet, and that is another story. Businesses are facing increased costs, which they are struggling to absorb or pass on to consumers. Walmart has shut down stores and is warning of potential price hikes, while Home Depot says its new prices will remain stable. The disparity in responses highlights the complexity they face amid rising duties and political pressure.

In the tech sector, companies like Apple are caught in a bind. After Apple Chief Executive Tim Cook unveiled plans to shift a bulk of the manufacturing to India, President Trump warned of a new 25-per cent tariff on iPhones manufactured outside the US, scare-mongering that India had one of the highest tariff regimes of its own. The threat is a dare, leaving Apple little room to manoeuvre. If we speak of autos, Ford estimates that the tariffs could cost it $1.5 billion in 2025. GM and Stellantis are restructuring production to mitigate the impact of increased input costs.

The agri sector is not immune. Farmers and food producers are facing higher costs, meaning higher prices for consumers. The effects are felt across the supply chain – from production to retail – as businesses struggle to navigate the new trade landscape. Farm equipment firms like John Deere have even locked horns with the administration to protect their business, rather than play the political fiddle. John Deere is shifting manufacturing to Mexico, while reiterating its commitment to the motherland by unveiling plans to invest $20 billion in the US over the next decade.

Emotion Tarnishing Reputation

Beyond its borders, the US is seeing a decline in tourism. Oxford Economics indicates a 9.4-per cent drop in global visitor arrivals for 2025, and a loss of $9 billion. Triggering this are a negative sentiment toward US policies, a strong dollar and rising costs. Destinations like Japan and South Korea are emerging as more viable alternatives for travellers, undermining the US’ position in the tourism scheme of things. Visits by tourists to US cities have fallen 30-50 per cent. And given the tariff-enforced currency devaluation of some countries, travelling to the US means increased costs of 20-30 per cent.

The loss does not limit itself to money and revenues alone. Friendships and relationships are being eroded, especially in top US cities such as California, Texas, New York, Washington, Arizona, Michigan and Florida. With fewer tourists coming in, it is not just airlines and hotel chains that face the blight – duty-free shops, gas stations, restaurants, casinos, bars, taxi and limo companies also suffer. But for many tourists, higher spends are not the key reason for scratching the US off their itinerary.

Canadians are the most miffed. “Las Vegas feels like a party we are not invited to,” a Canadian who cancelled his bookings said. “We don’t want to go because we are not needed.” Others feel a country they had always looked at as “pretty much our own” has changed colours. “Visiting the US was like going to a neighbour’s party. But this neighbour is now speaking of taking over my nation. I have crossed him off my list of favourite people, for ever,” another said, eyes stony.

The repercussions are being felt by American businesses, even small ones. A taxi driver who used to run airport shuttles for tourists says: “My income has halved. Worse, I have lost clients who became dear friends over years of visiting. This is a very sad, very bad time.”

Inevitability of Retaliation

The US-triggered trade faceoff is not unprecedented, and the country has a history of using tariffs as a tool for economic arm-twisting. Most often, the tactic has proven politically-expedient and economically-perilous. Previous instances of tariff imposition have followed a predictable cycle –protectionist enthusiasm, retaliatory actions from global partners, breakdown of trade relations, and a lasting damage to the very industries that the tariffs ostensibly set out to protect.

The earliest such example was the Smoot-Hawley Tariff Act of 1930, implemented during the Great Depression. Designed to protect American agriculture and manufacturing by raising tariffs on over 20,000 imported goods, it resulted in swift retaliation – Canada, France and other nations also raised tariffs and slashed US imports. Economists are unanimous today: “With the tariffs of 1930, the US deepened and prolonged the Great Depression.”

In 1983, then President Ronald Reagan imposed tariffs on Japanese motorcycles – targeting Honda and Kawasaki – to protect Harley-Davidson. The move initially stabilized the iconic US brand, but eventually led to increased prices and soured relations. The US was forced to roll back the tariffs, fearing long-term damage to its relationship with Japan.

In 2002, then President George W Bush imposed tariffs of 30 per cent to protect the steel sector. The result – the World Trade Organization ruled the tariffs “illegal” and the European Union threatened sanctions on $2.2 billion of US exports, targeting sectors such as orange juice and autos. Facing global pressure and domestic job losses, Bush lifted the tariffs in December 2003. A US commission admitted that the tariffs only led to one thing – a loss of 200,000 American jobs.

Soliloquy: These examples echo today’s situation. Tariffs as an economic scythe do not spark industrial revival, but spawn trade wars, retaliatory tariffs and market uncertainty. Economist Chad Brown says: “Tariffs do not insulate us; they isolate us. In an interconnected world, isolation means inefficiency, higher prices and less innovation.”

This latest instance of the US circling an old trade cul-de-sac is a move paved with misguided protectionism and painful repercussions. The Native American proverb we began with is a reminder. In the pursuit of economic advantage, we need to be mindful of larger implications and the potential for unintended consequences.

The writer is a veteran journalist and communications specialist. He can be reached on narayanrajeev2006@gmail.com. Views expressed are personal