Broken Promises: Liberation Day — Policy Paper on Tariffs

Summary

A policy paper titled "Liberation Day" among congressional materials, criticizing tariffs imposed by Donald Trump beginning April 2, 2025. The paper states that the tariffs have cost small businesses, consumers and households more than $230 billion in one year, and cites figures on grocery, housing and manufacturing costs. Sections address the effect on small businesses, the tariff exemption process, and trade agreements with the European Union, Japan, South Korea and India. It states that the Supreme Court held the use of the International Emergency Economic Powers Act to impose tariffs illegal. The paper closes with a list of actions Senate Democrats are taking, including votes to terminate global tariffs and tariffs on Canada and Brazil and efforts to limit presidential tariff authority.

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                                                  “Liberation Day”
Lead in sentence(s). Use style “Lead in” from Style pa

On April 2, 2025, Donald Trump unleashed a tariff regime that imposed sweeping tariffs on
nearly every country, allies and enemies alike. Those tariffs have taken different forms over
the past year, but one thing remains the same: Donald Trump’s tariff taxes are increasing
prices and making life more unaffordable for Americans. Trump’s chaotic and disastrous
tariff regime has done nothing but increase prices, kill jobs, and drive the U.S. economy to
the brink. These tariffs have cost small businesses, consumers, and households
more than $230 billion in just one year.

Before Trump even took office, less than three weeks after the 2024 election, he threatened
blanket tariffs of 25% on Canada and Mexico, the United States’ top two trading partners,
accounting for nearly $1 trillion of imports in 2024.

Trump’s trade war has only grown more expansive and chaotic since, with Trump’s tariffs
now hitting every country in the world, driving up the price of nearly everything from
groceries to electrical transformers to kitchen cabinets. While the Supreme Court correctly
struck down Trump’s original, illegal tariff regime, Trump has only doubled- and tripled-
down, pursuing all possible options to continue taxing American families and small
businesses.

Why is Trump forcing this economic pain on American families? He has claimed it is for the
benefit of everything from reducing the trade deficit (which hit a record high for
manufactured goods in 2025) to boosting U.S. manufacturing (which has lost tens of
thousands of jobs since the start of the trade war) to eliminating the federal income tax.

Whatever the supposed rationale, the outcome is clear: higher prices for Americans, a
stagnating labor market, and continued pain for American small businesses and
manufacturers.

Trump’s Tariffs are a Tax Hike on American Families

Trump’s tariffs are a tax that Americans pay. American families have already paid more
than $1,700 in tariffs and are expected to pay even more if Trump's tariffs continue.
Contrary to Trump’s claims that foreign countries pay the tariffs, nearly 90% of the cost of
the tariffs are being borne by American consumers and businesses. His tariffs are both
increasing the price of goods and making it more expensive to build and manufacture in the
United States.

Families are especially feeling the pinch as they buy groceries and try to put food on the
table. Trump’s tariffs have driven food costs up, with families paying over $300 more for
groceries in 2025. The price of fruit is 5.5% higher. Meat is more than 6% more expensive,
with beef prices hitting record highs (up 15%). Fish and seafood are nearly 4.5% more
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expensive. And in the morning, Americans have special sticker shock with coffee prices up
more than 9% and the cost of orange juice up by more than 30%.

Trump’s tariffs are also exacerbating America’s housing crisis. Housing is often the biggest
piece of a family’s monthly budget, and now, nearly one-third of American households
spend more than 30% of their income on their rent or mortgage. Home prices have surged
since 2020, and the median age of a first-time homebuyer is now 40 years old – the highest
ever. While Americans struggle to keep a roof over their heads, Trump’s tariffs are
increasing the cost of inputs from copper to kitchen cabinets, resulting in fewer new homes
being built and driving up the cost of homeownership.

With Friends Like These: Trump’s Tariffs Wreak Havoc on American
Manufacturers and Small Businesses

Trump claims his tariffs will bolster American businesses and supercharge American
manufacturing. The reality is that Trump’s tariffs are hammering American manufacturers
and throttling American small businesses.

Despite promises of a “manufacturing boom,” American manufacturers have shed nearly
90,000 jobs since President Trump’s so-called “Liberation Day.” A year into Trump’s trade
war, American manufacturing is in retreat, with spending on new factories declining, while
the President’s Treasury Secretary refuses to accept the reality that these tariffs are
decimating American manufacturing and continues to double-down on the policy.

The picture is even more bleak for America’s more than 36 million small businesses, which
employ nearly half of the American workforce and make up more than 40% of the country’s
economic activity. U.S. businesses paid nearly $200 billion in tariffs in 2025 with a third
likely being paid by small businesses – an average of more than $300,000 per business.
This Trump tariff tax hike is forcing entrepreneurs to make tough choices between bearing
the cost themselves, raising prices, cutting jobs, reducing benefits, or taking on debt. More
than 70% of small businesses surveyed say they have been negatively affected by Trump’s
tariffs.

Small businesses have historically created the majority of jobs in the U.S., but in 2025 they
bore the brunt of Trump’s trade war. In the second quarter of 2025, with Trump’s
declaration of “Liberation Day,” and the expansion of his trade war to nearly every country
in the world, small businesses were forced to cut 180,000 jobs. The situation did not
improve as the year went on, with small businesses losing an average of 34,000 jobs per
month in the fall of 2025, and a whopping 120,000 jobs in November 2025 alone.

Recent surveys show that half of small business owners have had to raise prices, while
more than one-fifth have been forced to delay plans to grow or expand. As they navigate
these new costs, some have even been forced to engage with the equivalent of payday
lenders, taking out loans they can’t pay back, all to grapple with the chaos of Trump’s tariff
taxes.
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Because of the devastating impact of President Trump’s tariffs, small businesses led the
fight to overturn his tariff taxes. Big businesses largely ducked the fight, opting for
exemptions and special favors. The Supreme Court sided with small businesses, calling
President Trump’s use of the International Emergency Economic Powers Act to impose
tariffs illegal.

The Chaos Tax: How Trump’s Tariffs Reward Insiders While Punishing
Small Businesses

On top of the direct financial hit to small businesses, the unpredictable nature of Trump’s
trade policy has created an environment fraught with instability that disproportionately
hits small businesses that are least equipped to absorb it. Instead of a coherent strategy,
Trump’s tariff policy has been unpredictable, destructive, and impossible to plan around.

Rates on goods from Canada, Mexico, China, and the EU have lurched up and down with
little notice, with Trump sometimes changing course within days of an announcement. For
large corporations, this volatility is difficult but manageable: they employ armies of trade
lawyers and can absorb short-term losses against deep balance sheets. Small business
owners don’t have those options. A hardware importer who locked in purchase orders
months in advance, a furniture maker dependent on specific Chinese components, or a
small manufacturer relying on Canadian aluminum cannot restructure their supply chain
between a Monday announcement and a Wednesday implementation.

The “exemption” process has made this worse by transforming tariff relief into a political
commodity. While Trump first claimed there would be no exemptions, the administration
then began carving out industry-specific and company-specific exceptions, which begs the
question: who gets relief and why? The answers have not been reassuring. Investigations by
journalists and watchdog groups have documented patterns in which exemptions flowed to
donors with access to administration officials; companies and industries with lobbyists in
the room; and sectors whose executives publicly praised the president.

A small business owner on Main Street cannot hire a K Street firm or give a golden gift to
get a meeting with the President. A major corporation with a PAC, a government affairs
office, and a CEO who golfs with the right people can. Trump’s tariff regime has created a
two-tier system where the politically connected get carve-outs and everyone else pays full
price.

Trump’s Trade “Deals” Are Illusory Promises That Lock in Higher Tariffs

While American families and small businesses grapple with higher prices and fewer jobs
due to Trump’s tariffs, Trump brags about vague trade “deals” that lack details and lock in
higher tariff rates, providing no relief for American consumers or any real, durable wins for
Americans.
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Before Trump took office, the average tariff rate on imports was roughly 2%. Trump has
hailed supposed agreements with the European Union, Japan, South Korea, and India,
among others. But many of these deals have not been formalized and signed, and it is
unclear whether trading partners will remain committed now that the Supreme Court has
invalidated many of Trump’s tariffs. In each case, these agreements have solidified tariff
rates as much as 1,500% higher than before Trump took office.

In the meantime, Trump has failed to address real trade threats. While he raises tariffs on
our allies like Canada and Europe, he has cut sweetheart deals with China, providing
access to advanced American technology while doing nothing to address China’s trade
abuses – including theft of intellectual property and using state subsidies to undercut
American companies and flood foreign markets with cheap goods.

Trump has also allowed the UAE to purchase advanced American technology, despite an
obvious conflict of interest, as a member of the Emirati royal family was behind a $500
million investment in the Trump family cryptocurrency company. This continues a trend of
trading away U.S. interests, including our national security, to enrich Trump, his family,
and his billionaire cronies.

Democrats are Fighting to End Trump’s Trade War and Lower Prices

Senate Democrats continue to fight back against Trump’s trade war, pushing to end
Trump’s tariff taxes and lower prices for American families and small businesses.

    •   Senate Democrats repeatedly forced successful votes to terminate Trump’s global
        tariffs, as well as tariffs on Canada and Brazil.

    •   Senate Democrats are pushing to lower the price of groceries and protect American
        small businesses and manufacturers from Trump’s trade war by exempting them
        from Trump’s tariffs.

    •   Following the Supreme Court decision overturning many of Trump’s tariffs, Senate
        Democrats have been pushing for illegally collected tariffs to be returned to the
        Americans who were forced to pay them.

    •   Senate Democrats are engaged in oversight, sounding the alarm as Trump applies
        tariffs arbitrarily and uses his trade schemes to enrich himself and his friends.

    •   Senate Democrats are pushing to rein in the President’s tariff authority by limiting
        what he can do without Congressional approval.

Trump’s tariff taxes are raising prices, killing jobs, and ruining America’s relationships
with our allies. Senate Democrats will continue fighting to end this chaos and lower costs
for families.


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