Erica York summarizes research on tariffs

From her Twitter account.

"We can also look at the studies the White House chose not to cite:

An April 2019 University of Chicago study conducted by Aaron Flaaen, Ali Hortacsu, and Felix Tintelnot found that after the Trump administration imposed tariffs on washing machines, washer prices increased by $86 per unit and dryer prices increased by $92 per unit, due to package deals, ultimately resulting in an aggregate increase in consumer costs of over $1.5 billion.

An October 2019 study by Alberto Cavallo and coauthors found tariffs on imports from China were almost fully passed through to US import prices but only partially to retail consumers, implying some businesses absorbed the higher tariffs, reducing retail margins, instead of passing them on to retail consumers.

In December 2019 (study updated in August 2024), Federal Reserve economists Aaron Flaaen and Justin Pierce found a net decrease in manufacturing employment due to the tariffs, suggesting that the benefit of increased production in protected industries was outweighed by the consequences of rising input costs and retaliatory tariffs.

A February 2020 paper from economists Kyle Handley, Fariha Kamal, and Ryan Monarch estimated the 2018–2019 import tariffs were equivalent to a 2 percent tariff on all US exports.

A December 2021 review of the data and methods used to estimate the trade war effects through 2021, by Pablo Fajgelbaum and Amit Khandelwal, concluded that “US consumers of imported goods have borne the brunt of the tariffs through higher prices, and that the trade war has lowered aggregate real income in both the US and China, although not by large magnitudes relative to GDP.”

A January 2022 study from the US Department of Agriculture estimated the direct export losses from the retaliatory tariffs totaled $27 billion from 2018 through the end of 2019.

A January 2024 study by David Autor and others concludes that the 2018–2019 tariffs failed to provide economic help to the heartland: import tariffs had “neither a sizable nor significant effect on US employment in regions with newly‐​protected sectors” and foreign retaliation “by contrast had clear negative employment impacts, particularly in agriculture.”

A NY Fed January 2025 study "We find that a fall in a firm’s stock prices on tariff-announcement days is associated with a significant decline in firm performance between 2019 and 2021. In particular, a one-standard-deviation fall in a firm’s stock prices (a 0.56 percent fall in market value) is associated with a fall of 12.9 percent in profits, 3.9 percent in employment, 6.7 percent in sales, and 2.2 percent in productivity.""

The 3 Myths Supporting NIH Funding

By Zachary R. Caverley. He is a Physician Assistant practicing Cardiology in Oregon. From Reason. Excerpt:

"Myth No. 1: The U.S. Cannot Be an Innovative Research Leader Without Strong Public Funding

Shortly after the funding cuts were announced, a member of the University of California, Santa Cruz's informatics team wrote, "American research institutions have historically been at the forefront of medical and technological advancements. This proposal is a fast track to reversing that. Other countries that actually invest in research will surge ahead while U.S. institutions struggle to keep the lights on."  

These arguments make sense only if the following assumptions are accurate: that the amount of NIH spending is important for scientific achievement, and that publicly funded academic research is the primary factor needed for innovation. These assumptions don't stand up under scrutiny. 

Like many things in U.S. research, the NIH owes its growth to the spoils of war. The Ransdell Act of 1930 that established NIH research fellowships was the product of World War I chemists looking for funding to apply their knowledge to medical issues. The subsequent Public Health Service Act of 1944 arose from proponents such as Vannevar Bush, who ran the Office of Scientific Research and Development during World War II, wanting to ensure the massive federal science endowments that took place during the war would continue through peacetime. From these efforts, despite U.S. science previously being mostly laissez faire, the NIH budget would expand from $8 million in 1947 to more than $1 billion in 1966. If federal funding is a prerequisite for scientific innovation, we would expect a severe lack of the latter in medicine prior to the expanded federal role.

But in the early 20th century, philanthropists were already funding the type of research the NIH later did, with impressive yields. Among them was the Rockefeller Foundation, whose research led to the discovery of a vaccine for yellow fever, advanced the understanding of cell biology, and assisted the efforts to mass produce penicillin. For this latter effort, U.S. pharmaceutical firms proved to be the key component to produce enough penicillin to sustain the war efforts and help save the lives of wounded soldiers.     

U.S. biomedical science in the era before the NIH was spreading federal money was not hurting for private support, and while some insist that increased government spending only strengthened a good foundation, the public sector's role is often overstated regarding some canonical research achievements. The Human Genome Project is a good example. The NIH correctly asserts this groundbreaking international collaboration "changed the face of the scientific workforce," but it was only made possible by the automatic gene sequencer developed by Leroy Hood, who noted the invention received "some of the worst scores the NIH had ever given."

It was only through the generosity of Sol Price—the founder of warehouse superstores—that the technology came to fruition and the human genome was finally sequenced. Similar stories of private generosity in place of government grants can be found for stem cell research.

As for the importance of publicly supported academics, consider the story of mRNA vaccine development. The NIH timeline implies that smart government investment into years of HIV research was the key to this lifesaving technology, but the chief innovator of the eventual product, Katalin Karikó, was roadblocked for years in academia and even demoted for her lack of grant acquisition. She would later leave the university setting and work for BioNTech in the private sector to create the Pfizer vaccine. Her story is conspicuously absent from the NIH timeline of events.

Karikó's experience suggests that public funding for academic science is not necessarily the crucial factor for scientific advancement and innovation. In practice, the private sector drives new technologies. Drug development, for instance, would be impossible without the power of the pharmaceutical industry to fund new chemical entities. Authors of a 2016 survey on some of the most transformational drug therapies that appeared in the journal Therapeutic Innovation & Regulatory Science wrote that "without private investment in the applied sciences there would be no return on public investment in basic science." 

A subsequent analysis in 2022 in the same journal found that only privately funded projects actually hit the market as Food and Drug Administration–approved therapies and that public funding had a possible negative effect on achieving approval. Note the cautious interpretation by the authors: "Our study results underscore that the development of basic discoveries requires substantial additional investments, partnerships, and the shouldering of financial risk by the private sector if therapies are to materialize as FDA-approved medicine. Our finding of a potentially negative relationship between public funding and the likelihood that a therapy receives FDA approval requires additional study" (emphasis added).

If it cannot deliver therapies, federally funded science should at least be producing noteworthy and reproducible science. A writer for Psychology Today noted this month that the federal government is the largest funder of psychological research. But should we consider that a good thing? Psychology is a research field where as low as one-third of the findings can be replicated for a given set of publications, which calls into question the trustworthiness of that nonreproducible work. Even outside psychology, it is not even clear that federally funded research is producing our most noteworthy scientists: A large majority of researchers authoring the most highly cited papers in the biomedical research field operate without NIH funding."

Manufacturing employment has been falling since the early 1950s and NAFTA did not affect the trend

 From Marian Tupy on Twitter.