Donald Trump’s War on Christmas
As the holiday season approaches, American families are projected to spend a staggering $1 trillion on gifts and festive goods, marking a 4% increase from last year. However, this festive cheer is overshadowed by rising prices, largely attributed to the ongoing trade war initiated by President Donald Trump. Families are not only paying more for traditional holiday items like artificial trees, ornaments, and toys, but they are also facing a reduced selection as some retailers have ceased shipping to the U.S. and others have gone out of business. The average household is expected to shell out an additional $132 this year due to tariffs, a burden that, while manageable for some, is compounded by cooling wage growth, rising unemployment, and increasing living costs. With consumer confidence plummeting, many families are opting for budget-friendly shopping options, purchasing fewer items, and delaying major expenses.
The impact of the trade war is particularly pronounced among small businesses, which struggle to adapt to the new economic landscape. While larger corporations like Walmart have managed to navigate the challenges by securing discounts and rerouting supply chains, small businesses lack the resources and bargaining power to do the same. Many have been forced to raise prices, lay off employees, or even shut down altogether. A recent survey revealed that 71% of small-business owners anticipate a decline in revenue this holiday season, with only 5% planning to hire or expand their operations. Nichole MacDonald, who runs a specialty handbag company, expressed her fears about the holiday season, stating that her products are stuck in warehouses in India due to the prohibitive import tariffs. She has had to raise prices, cancel orders, and let go of staff, highlighting the severe challenges small businesses face in this uncertain economic climate.
This precarious situation is further exacerbated by a broader economic malaise, marked by a government shutdown and a cautious approach to hiring across various sectors. Companies are hesitant to lower prices due to the high tariffs, which are at their highest effective rate in nearly a century. The combination of these factors has created a stagflationary environment, leaving many consumers feeling less festive as they navigate the holiday season amidst rising costs and economic uncertainty. The sentiment among small business owners like MacDonald encapsulates the struggle: “Are they literally trying to make it impossible to run a business? Because that’s how it feels.” As the year draws to a close, the challenges facing American families and small businesses alike cast a shadow over what is traditionally a season of joy and celebration.
https://www.youtube.com/watch?v=HGHjbD3XcUs
President Donald Trump might not be ruining Christmas, but he’s making it more expensive. American families are
expected to spend
$1 trillion on gifts and other goods this November and December, roughly 4 percent more than they spent last year. But they’re paying more for everything—artificial trees, ornaments, toys, novelty sweaters. They have fewer
options
to choose from when they log on to Etsy and browse upscale boutiques. Some retailers have stopped shipping to the United States, and some have gone out of business—all thanks to Trump’s globe-engulfing and pointless trade war.
Holiday shoppers might not notice that things are a little less merry and bright than they would have been otherwise. The average family is expected to spend $132
more this year
because of tariffs—not nothing, but not enough to break the bank, either. But wage growth has
been cooling
. The unemployment rate has been rising. Consumer confidence has been
falling sharply
. Rent, co-pays, mortgages, car payments, and utilities remain brutal for average families to afford—and health insurance is about to get radically
more expensive
. In recent weeks, customers have started shopping at cheaper outlets, buying fewer items, and putting off major expenses.
Shoppers are looking for deals, but it has not been easy for stores to provide them. When Trump kicked off the trade war early this year, the White House argued that foreign exporters would pay the fees slapped on goods from nearly every American trading partner. Instead, the government
has collected
$118 billion and counting from domestic importers.
Big companies have managed to dodge and shuffle in response: pressing their
suppliers for discounts
, stocking up and storing
products
to get ahead of the tariffs, rerouting their supply lines, buying merchandise from lightly tariffed countries. Retailers including Walmart have managed to keep their sales figures up and hold costs down, for the most part. Yet many companies have run out of warehoused items, leaving them no choice but to raise sticker prices or cut into their profits.
Small companies have had fewer options. Many small-scale businesses lack the time, bandwidth, or travel budget to find new overseas suppliers—especially when big importers are doing so too. Boutiques don’t have the bargaining power to press manufacturers and shipping companies for discounts. Single-person firms cannot take out loans to buy up stock and move it to the United States before a trade levy hits. Many small firms cannot change their product lines, either.
As a result, the trade war has helped large companies squeeze out their smaller competitors. Many small firms have closed down, fired workers, watched their sales fall apart, or worse. In a
new survey
, 71 percent of small-business owners said they expect the trade war to depress their revenue this holiday season. Only 5 percent said they were hiring and expanding their business.
The holiday season “is our Super Bowl,” Nichole MacDonald told me. “This is when we’re supposed to make all of our money.” MacDonald runs the Sash Bag, a company that manufactures and sells specialty
handbags
. Like many retailers, the Sash Bag generates an outsize share of its annual sales and profits leading up to Christmas. But this year, she said, she is “literally terrified.” Batches of her bags are stuck in two warehouses in India because she cannot produce the $430,000 needed to cover the import tariffs on the goods. “That product is done,” she said. “It’s sewn. It’s perfectly saleable—beautiful leather, beautiful Sash bags, sitting in India for months because I don’t have the budget to bring it here.”
In addition, she has let go some of her employees, raised prices by 10 to 15 percent, canceled special orders, and considered finding new suppliers. But “people don’t understand” how hard that is to do, MacDonald told me, when you have “your own proprietary product, not something a manufacturer has already invented or already created.”
Struggling firms aren’t the economy’s only problem. The government shutdown has depressed the Washington, D.C., metro economy. Concerns about artificial intelligence and the growth outlook have led businesses of all sizes to quit hiring, and some have started firing workers too. Households have noticed those changes and are limiting their spending. Yet companies don’t have much room to win back customers by cutting prices, in many cases—because of the tariffs, which are at their highest effective rate in close to a century. The country is in a stagflationary, queasy state as the year comes to a close, and it’s not doing much for anyone’s holiday spirit.
“Are they literally trying to make it impossible to run a business?” MacDonald asked me. Because “that’s how it feels.”
