Where Are the Tariff Refunds for American Consumers?
Living with Trump is not only tiring; this is expensive, both for consumers and businesses. Last year he said Americans would receive a tariff “dividend” of two thousand dollars each, but that turned out to be an empty promise. According to Yale’s Budget Lab, its tariffs increased the overall cost of imported goods by about 1.5 percent last year, with much greater impacts on some items, such as clothing and leather goods. According to the nonpartisan Tax Foundation, the average cost to American households was about a thousand dollars. Given that some of these tariffs have been found to be illegal, it seems only right that consumers would also get a refund. However, so far, Costco and FedEx are among the few large companies that have committed to passing government payments on to their customers in the form of price drops or refunds. Other countries appear determined to use this cash to rebuild their profit margins, which in some cases were reduced when they absorbed part of the tariffs.
A number of class action lawsuits have been filed against Amazon and other major companies on behalf of their customers. Woldenberg said all businesses that import items and pay Trump’s tariffs will face the issue of reimbursement. He said Learning Resources plans to keep its prices stable this year and next, absorbing higher costs for energy and other things. “We think this is the best way to get back to where we were in a year or two,” he said. “I think this is a good faith effort on our part.”
Woldenberg’s experience taking a case all the way to the Supreme Court is exceptional. But the time, energy and resources he and his colleagues at Learning Resources have devoted to navigating Trump’s tariffs in their daily operations are typical of many companies, large and small. Clearly, some American companies, such as steel mills, have benefited from specific levies explicitly introduced to protect them from foreign competition. But for most businesses affected by blanket tariffs, it all looks like a colossal waste of time and effort. And this policy didn’t even work on its own terms.
In recent years, even some free trade advocates have come to the view that some tariffs may be justified for strategic and national security reasons, particularly when working with an overtly mercantilist country like China. The Biden administration retained most of the Section 232 tariffs on Chinese goods that Trump introduced during his first term: it even expanded them. But the broad tariffs introduced by Trump last year were different: They targeted all countries with a trade surplus with the United States, even those that are too poor to import much from the United States. The economic concepts of comparative advantage and trade gains elude Trump, who views any bilateral trade deficit as proof that the United States is being “ripped off.” The argument for these across-the-board tariffs was that reducing the overall trade deficit would be a good thing in itself, and that it would also boost manufacturing employment and transform government finances.
So, what is the outcome? Yale’s Budget Lab reports that the tariffs generated approximately two hundred and fifteen billion dollars in revenue. But after the Supreme Court’s ruling, about two-thirds of that amount will have to be repaid, so the overall impact on federal finances will be relatively minor. The trade deficit? Between March and October last year it fell sharply, but that was largely due to international gold shipments and companies rushing to circumvent Trump’s tariffs by placing their import orders before they took effect. For the whole of 2025, the trade deficit in goods reached a record level and, so far this year, it has remained high. Rather than reducing the overall number of imports, Trump’s tariffs appear to have primarily diverted their source from China to other countries, including Vietnam and Mexico — a point that White House economists acknowledged last month in the president’s 2026 economic report, which noted a shift toward “more diverse global supply chains.”
To the extent possible, this is a welcome development. However, it does not reduce U.S. dependence on foreign capital – trade deficits must be financed by attracting foreign investment or loans – nor does it create new jobs at factories in Michigan and Ohio. When Trump was second inaugurated, there were 12.7 million manufacturing jobs nationwide. Last month, there were 12.6 million. While the Biden administration has introduced generous subsidies to invest in certain technologies, such as semiconductors and electric vehicles, construction spending in the manufacturing sector has more than tripled. Since the November 2024 election, it has fallen by about a fifth. Citing announcements from Apple, Nvidia and other companies announcing plans to build new factories in the United States, the White House still says manufacturing is “coming back strong.” So far, at least, there is little sign of such an increase in the overall statistics.
