Instead of immediately passing tariff costs to consumers, US corporations are initially absorbing the shock. They are mitigating the impact by reducing labor costs and accepting lower profitability, which explains the lag between tariff implementation and broad consumer inflation.

Hollywood's current crisis is self-inflicted, stemming from a decades-long failure to adapt its business models and economics. Instead of innovating to compete with tech-driven services like Netflix, the industry persisted with inefficient structures and is now blaming disruptors for inevitable consumer-driven changes.

Ford builds over 80% of its US-sold vehicles domestically. However, this scale requires importing the most parts, so US tariffs on parts penalize Ford more heavily than companies that import whole vehicles at a lower effective tariff rate, creating a competitive disadvantage.

While the US exports less to Canada by volume, its exports (electronics, pharma) have far higher margins and shareholder value multiples than Canadian exports (lumber, oil). Therefore, for every dollar of trade disrupted by tariffs, the US loses significantly more economic value, making the policy self-defeating.

While large firms like NVIDIA can onshore manufacturing, small hardware startups relying on Chinese production are the primary casualties of tariffs. They lack the scale to move supply chains or secure exemptions, eroding their margins and weakening their negotiating position with investors.

Tariffs are politically useful in a fiscal crisis because they function as a hidden consumption tax. They allow politicians to claim they're taxing foreigners and protecting the nation, while the revenue raised is insufficient to solve the debt problem and domestic consumers bear the cost.

Because U.S. tariff levels are likely to remain stable regardless of legal challenges, the more critical factor for the long-term outlook is how companies adapt. Investors should focus on corporate responses in capital spending and supply chain adjustments rather than the tariff levels themselves.

US policy fetishizes a return to manufacturing, which employs 11% of the workforce. However, protectionist policies like tariffs actively harm the higher-margin, larger tourism industry, which employs 12%. This represents a sclerotic and irrational trade-off that damages a more valuable sector of the economy.

Far from being a precise tool against China, recent US tariffs act as a blunt instrument that harms America's own interests. They tax raw materials and machine tools needed for domestic production and hit allies harder than adversaries. This alienates partners, disrupts supply chains, and pushes the world towards a 'World Minus One' economic coalition excluding the US.