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Economists say companies generally have to pass along the cost of tariffs. But populists on the left and right say the president may have a point.
May 20, 2025, 4:08 p.m. ET
When President Trump complained on Saturday that Walmart should “stop trying to blame tariffs” for looming price increases, many economists recalled the last time they heard a president rail against companies for raising prices.
It was last year, in fact, when President Joseph R. Biden Jr. cited “corporate greed” as the reason Americans were paying more for gas, food and rent, while deflecting criticism that his policies had worsened inflation.
And economists are generally no more persuaded of the accusation when a Republican leveled it than when a Democrat did.
“Fundamentally, what we’re seeing in both instances is that the president makes a policy mistake, that policy mistake leads to an increase in consumer prices and the president who made the policy mistake is blaming the businesses,” said Michael Strain, an economist at the right-leaning American Enterprise Institute.
In the case of Mr. Trump’s tariffs, which are set at 30 percent on Chinese imports until mid-August, the effects will reverberate across the economy, either pushing up prices for consumers or, if companies do absorb some of the costs, lowering profits for businesses. Those responses could drive inflation, slow growth and raise unemployment.
Yet while mainstream economists are generally in agreement that there is nothing unseemly about companies raising prices when their costs spike, that view is hardly universal outside the profession.
