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.

Despite tariffs making imports more expensive, moving furniture production back to the US is seen as unrealistic. The primary obstacle is not financial, but a critical shortage of trained workers who can and want to do the work, a deficit that tariffs cannot fix.

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.

The success of tariffs hinges on the insight that China's economic model prioritizes volume and employment over per-unit profitability. This creates a vulnerability where Chinese producers are forced to absorb tariff costs to maintain output, effectively subsidizing the tariff revenue and preventing significant price increases for US consumers.

Donald Trump's tariffs on furniture, meant to boost US manufacturing, are increasing costs for domestic producers. Even companies manufacturing in North Carolina still import essential parts like wooden sofa legs and fabrics, making them collateral damage of the trade policy.

Despite significant US tariffs hitting labor-intensive goods, China's overall export volume remains strong. This resilience stems from a structural shift towards high-tech sectors like semiconductors and autos, combined with strategically rerouting trade through intermediary ASEAN countries to circumvent direct tariffs.

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.