Today was supposed to be the day that President Donald Trump’s so-called “reciprocal” tariffs on dozens of countries kicked in after a three-month delay, absent trade deals. But their introduction has been postponed, again.
The new, August 1 deadline prolongs uncertainty for businesses but also gives America’s trading partners more time to strike trade deals with the United States, avoiding the hefty levies.
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Mainstream economists would probably cheer that outcome. Most have long disliked tariffs and can point to research showing they harm the countries that impose them, including the workers and consumers in those economies. And although they also recognize the problems free trade can create, high tariffs are rarely seen as the solution.
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Trump’s tariffs so far have not meaningfully boosted US inflation, slowed the economy or hurt jobs growth. Inflation is “the dog that didn’t bark,” Treasury Secretary Scott Bessent likes to say. But economists argue inflation and jobs will have a delayed reaction to tariffs that could start to get ugly toward the end of the year, and that the current calm before the impending storm has provided the administration with a false sense of security.
“The positives (of free trade) outweigh the negatives, even in rich countries,” Antonio Fatas, an economics professor at business school INSEAD, told CNN. “I think in the US, the country has benefited from being open, Europe has benefited from being open.”
Consumers lose out
Tariffs are taxes on imports and their most direct typical effect is to drive up costs for producers and prices for consumers.
Around half of all US imports are purchases of so-called intermediate products, needed to make finished American goods, according to data from the Organisation for Economic Co-operation and Development.
“If you look at a Boeing aircraft, or an automobile manufactured in the US or Canada… it’s really internationally sourced,” Doug Irwin, an economics professor at Dartmouth College, said on the EconTalk podcast in May. And when American businesses have to pay more for imported components, it raises their costs, he added.
Likewise, tariffs raise the cost of finished foreign goods for their American importers.
“Then they have to pass that on to consumers in most instances, because they don’t have deep pockets where they can just absorb a 10 or 20 or 30% tariff,” Irwin said.
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The bow of a US Navy cruiser damaged in a World War II battle in the Pacific has shone new light on one of the most remarkable stories in the service’s history.
More than 80 years ago, the crew of the USS New Orleans, having been hit by a Japanese torpedo and losing scores of sailors, performed hasty repairs with coconut logs, before a 1,800-mile voyage across the Pacific in reverse.
The front of the ship, or the bow, had sunk to the sea floor. But over the weekend, the Nautilus Live expedition from the Ocean Exploration Trust located it in 675 meters (2,214 feet) of water in Iron Bottom Sound in the Solomon Islands.
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Using remotely operated underwater vehicles, scientists and historians observed “details in the ship’s structure, painting, and anchor to positively identify the wreckage as New Orleans,” the expedition’s website said.
On November 30, 1942, New Orleans was struck on its portside bow during the Battle of Tassafaronga, off Guadalcanal island, according to an official Navy report of the incident.
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The torpedo’s explosion ignited ammunition in the New Orleans’ forward ammunition magazine, severing the first 20% of the 588-foot warship and killing more than 180 of its 900 crew members, records state.
The crew worked to close off bulkheads to prevent flooding in the rest of the ship, and it limped into the harbor on the island of Tulagi, where sailors went into the jungle to get repair supplies.
“Camouflaging their ship from air attack, the crew jury-rigged a bow of coconut logs,” a US Navy account states.
With that makeshift bow, the ship steamed in reverse some 1,800 miles across the Pacific to Australia for sturdier repairs, according to an account from the National World War II Museum in Louisiana.
Retired US Navy Capt. Carl Schuster described to CNN the remarkable skill involved in sailing a warship backwards for that extended distance.
“‘Difficult’ does not adequately describe the challenge,” Schuster said.
While a ship’s bow is designed to cut through waves, the stern is not, meaning wave action lifts and drops the stern with each trough, he said.
When the stern rises, rudders lose bite in the water, making steering more difficult, Schuster said.
And losing the front portion of the ship changes the ship’s center of maneuverability, or its “pivot point,” he said.
“That affects how the ship responds to sea and wind effects and changes the ship’s response to rudder and propellor actions,” he said.
The New Orleans’ officers would have had to learn on the go a whole new set of actions and commands to keep it stable and moving in the right direction, he said.
The ingenuity and adaptiveness that saved the New Orleans at the Battle of Tassafaronga enabled it to be a force later in the war.
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