It is still early in President Trump’s second term, with his first 100 days back in office approaching. What initially began as a series of trade policy proposals has now developed into an active trade conflict.
On April 2, 2025, President Trump implemented a baseline tariff of 10% on all U.S. imports. By April 9, tariffs on Chinese goods increased to 145%. In response, China imposed retaliatory tariffs of 125% on American exports, marking a significant escalation in trade tensions between the two countries.
Trade with China is projected to decline sharply, with the World Trade Organization forecasting an 80% decrease in trade volume between the two nations.
Same Salary, Different Habits
Emily Krupa, a management trainee at Enterprise Rent-A-Car, says she has started noticing changes in her spending habits.
“I feel like I have to be more frugal with fun purchases,” Krupa said. “I can’t do a lot of things just because I want to. Especially at the grocery store and gas prices, I kind of have to think about it more.”
It is still early in President Trump’s second term, with his first 100 days back in office approaching. What initially began as a series of trade policy proposals has now developed into an active trade conflict.
On April 2, 2025, President Trump implemented a baseline tariff of 10% on all U.S. imports. By April 9, tariffs on Chinese goods increased to 145%. In response, China imposed retaliatory tariffs of 125% on American exports, marking a significant escalation in trade tensions between the two countries.
Trade with China is projected to decline sharply, with the World Trade Organization forecasting an 80% decrease in trade volume between the two nations.
Same Salary, Different Habits
Emily Krupa, a management trainee at Enterprise Rent-A-Car, says she has started noticing changes in her spending habits.
“I feel like I have to be more frugal with fun purchases,” Krupa said. “I can’t do a lot of things just because I want to. Especially at the grocery store and gas prices, I kind of have to think about it more.”
Housing Market Pressure
For people in the housing market, President Trump’s trade war brings with it challenges–especially when it comes to the cost of building materials.
Carrington Frank, a social media manager at Realty Austin, is navigating the market firsthand. Frank and her husband have put their home in San Antonio on the market and are trying to buy in North Austin–where they originally wanted to live.
“I feel like no matter what happens we have to have a place to live,” Frank said. “So we kind of just took the mindset of whatever happens, we’re going to try to continue doing what we were going to do anyway, which is buy a house. I think if at the time we are looking to buy and tariffs are affecting the price, then we may have to try and pivot, but otherwise we’re not that worried about it.”
Frank’s optimism is shared by some–but not all–in the housing industry. Mike Ruiz, a loan officer at Cornerstone Mortgage Lending says the cost of new construction is rising because of tariffs on lumber, steel, and appliances — much of which is imported from Canada and China.
“Affordability is going to come down to inventory supply,” Ruiz said. “If no new homes are being built because builders are concerned over their costs, that decreases the supply. Therefore, the demand that’s already there not being met is going to continue to rise.”
Future Implications and Legal Issues
Economists are closely monitoring the potential long-term effects of the newly imposed tariffs. According to the Penn Wharton Budget Model, current trade policies could lead to a projected 6% decrease in long-term GDP and a 5% drop in average wages. Additionally, middle-income households may experience an estimated lifetime economic loss of approximately $22,000 due to higher consumer prices and slower wage growth. Legal challenges are also emerging. California Governor Gavin Newsom has filed a lawsuit against the administration, questioning the president’s use of the International Emergency Economic Powers Act to justify the tariffs. The suit argues that this application of the law may bypass traditional congressional oversight. Several other legal challenges are expected as states and trade organizations examine the broader implications of the administration’s trade strategy.
Looking Ahead
As the effects of the trade conflict continue to ripple through the economy, households, industries, and policymakers are adapting in different ways. From higher prices at the grocery store to rising construction costs and legal battles over executive authority, the early days of this trade policy shift have already triggered widespread consequences.
For individuals like Emily Krupa and Carrington Frank, the trade war is no longer an abstract political issue—it’s something they experience in their daily financial decisions. The cost of living adjustments, job market uncertainty, and economic pressure are influencing both short-term behaviors and long-term planning for many Americans.
Meanwhile, businesses are bracing for continued volatility. Importers and exporters alike are adjusting supply chains, reevaluating pricing strategies, and considering how to stay competitive in a global market that is increasingly shaped by geopolitical maneuvering rather than free-market principles.
Policymakers at the state and federal levels will likely face increasing pressure to respond to the tangible impacts of tariffs. Whether through legislative efforts, court challenges, or negotiations with trade partners, the coming months may define the trajectory of U.S. economic policy for years to come.
While some argue that these measures are necessary to protect American industries and assert national economic interests, others caution that prolonged disruption could cause lasting damage to economic growth and international relationships. What remains clear is that the trade war has begun—and its outcome will depend not only on policy decisions in Washington and Beijing, but also on how American consumers, workers, and businesses choose to respond.
