Tariff Effects: Financial Decisions We Face

The Tariff Effect: My Lawnmower Dilemma and What It Means for You

By Alexander Hernandez, J.D., Professor, and Author of Consumer Bankruptcy Law (Routledge).

Analysis and Commentary.

• Tariff Effects: Moody’s Mark Zandi reports one-third of the U.S. is already feeling recession effects. Your wallet likely agrees.
• Florida’s Economic Strain: Tariffs and immigration policies are driving up orange juice prices and causing labor shortages, especially among H-2A visa workers.
• Tariff Myth Debunked: Consumers do pay for tariffs. Basic business math proves that costs are passed down, not absorbed.
• Corporate Constraints: Boards can’t “eat the cost” of tariffs without violating fiduciary duties and risking shareholder losses.
• Tourism Collapse: Las Vegas, New York, and Southwest Florida are seeing occupancy drops due to reduced international travel, especially from Canada.
• Politics vs. Pocketbook: Economic consequences are bipartisan: everyone pays the same price regardless of political stance.
• Shared Financial Struggle: The current downturn is no longer isolated. We are all in this together.
• Your Wallet Doesn’t Lie: Rising prices and falling income aren’t political statements; they’re financial facts.

The Tariffs Have Me Thinking What is Next

This isn’t your typical blog post about yard work. It’s a look at how a seemingly simple decision like whether to buy a new lawnmower reveals a much larger and more serious issue affecting our economy: tariffs.

• Recession Risks: Which States Are Struggling the Most?

I’m now facing this situation myself, and it’s a perfect example of how tariffs are not just abstract government policies. They hit us where it hurts: our wallets.

Here’s my problem, my lawnmower, which I love, is a Ryobi self-propelled mower, but I have a one-acre lot, and in the brutal heat of summer, well, my lawn isn’t getting mowed as much as it should. A new sit-down lawnmower seems like the solution. But here’s the catch: the prices are a stark reminder of the financial pain we are feeling due to tariffs.

• Understanding Tariff-Driven Inflation

A new lawnmower can cost $2,000 plus, and I’m concerned that if I wait, the price will only go up. At the same time, I don’t want to get into additional debt. Products made of steel and aluminum, like cars, lawnmowers, and carports, are seeing massive price increases due to these tariffs. I had wanted to buy a carport for my travel trailer, but at $3,000 to $5,000, I decided it wasn’t the right time to make that investment.

The Ripple Effect of Tariffs

The issue isn’t just about a single purchase. It’s about the cumulative effect on our household budgets. The average family is seeing an increase in expenses ranging from $2,500 to $4,000 per year. That’s a significant amount of money that’s suddenly gone from your budget, eating into your savings or forcing you to take on more debt.

• Impact of the Trump Tariffs on Grocery Prices

And it’s not just consumers who are feeling the pinch. I’ve been watching companies like John Deere laying off workers. While they cite a drop in demand, it’s clear that the tariffs are a major contributing factor. When the cost of their raw materials goes up, their prices have to rise, and consumers, already dealing with their own financial pressures, simply stop buying.

A Decision We All Face

So, what do I do? Do I drop $2,000 on a new lawnmower now, or do I risk paying $2,500 or more in six months or a year? It’s a decision many of us are facing with all sorts of purchases. A broken appliance, a car in need of repair, do you fix it now for a couple of hundred dollars, or do you risk a full replacement for thousands down the line? Will I be in more debt when I make the purchase, or less?

The lesson here is simple: these tariffs are affecting your life right now. They’re making everyday purchases more expensive and forcing us to make difficult financial decisions.

I want you to think about this moving forward. What decisions do you need to make right now? Is there an expense you have to get out of the way before the price goes up? Do you fix an old item or buy a new one?

The economy may be a complicated subject, but the effects of these policies are crystal clear in our day-to-day lives. I hope this helps you consider your own financial situation as I grapple with mine.

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This blog is for informational purposes only and should not be considered as professional advice. Please consult with a qualified professional before making any decisions based on the content of this podcast.