Tariffs Hit At Midnight, Small Business Reactions, National Security Firings

Summary

Up First from NPR - April 4, 2025

Hosts: Leila Fadel, Steve Inskeep, Michel Martin, and A Martinez
Episode Title: Tariffs Hit At Midnight, Small Business Reactions, National Security Firings

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1. Introduction to New Tariffs

[00:02] Layla Falden opens the episode by announcing that President Trump's new tariffs on nearly all imported goods will take effect at midnight. Michelle Martin adds, "This is the reordering of global trade" ([00:08]). Scott Horsley poses a critical question: "Will the US come out ahead or fall behind?" ([00:11]).

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2. Stock Market and Economic Implications

[02:11] The discussion shifts to the immediate impact of the tariffs on both Wall Street and Main Street. Howard Lutnick, NPR’s business correspondent, explains the severity of the market reaction: "The Dow Jones industrial average tumbled more than 1600 points yesterday, or nearly 4%. The NASDAQ dropped nearly 6%. It was the biggest one-day sell-off in the stock market since early in the pandemic" ([02:49]). He further elaborates that President Trump has ordered a minimum 10% tax on nearly everything the US buys from other countries, with even higher tariffs on imports from China, Japan, and the European Union ([02:49]).

Michelle Martin asserts, "I don't think there's any chance that President Trump's going to back off his tariffs. This is the reordering of global trade" ([03:39]). Howard Lutnick warns about the long-term effects: "If these tariffs stick, it's going to upend the global trading system that the US has spent decades building and leave this country more isolated from the rest of the world" ([03:47]).

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3. Impact on Small Businesses

[02:31] Scott Horsley introduces the segment on small businesses affected by the tariffs, joined by correspondents Scott Horsley and Alina Selyuk. Danny Reynolds shares his firsthand experience at a National Retail Federation event, describing the shock among small business owners: "It was like shell shock because these companies are on the hook to pay many of these fees" ([06:17]).

Sarah Wells, a small business owner from Virginia, provides a poignant example: "I had to come up with $15,000 of extra cash to release my goods just this last month" ([07:03]). As tariffs on Chinese imports escalate to 54%, Wells laments, "Even if we pass some to the consumer, we can't pass it all. So I really think the honest answer is that businesses will close" ([08:15]).

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4. Broader Economic Analysis

Howard Lutnick delves into the broader economic ramifications, highlighting that these tariffs will lead to higher prices, slower economic growth, and potential job market fallout ([04:00]). He emphasizes that while the tariffs are intended to raise revenue for the government, they disproportionately affect working-class Americans: "It's a reverse Robin Hood policy, trading taxes for tariffs. It takes money from the poor and gives it to the rich" ([04:53]).

Additionally, Lutnick points out the global repercussions, noting that other countries may reduce their imports from the US, harming American farmers and factories. He cites the example of tropical fruits, such as bananas, which the US does not grow at scale: "Americans are going to pay more for them" ([05:34]).

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5. Challenges for Domestic Manufacturing

In response to Trump's argument that tariffs would bring manufacturing back to the US, Alina Selyuk presents the challenges faced by small businesses. She notes that many small retailers have already attempted to source domestically, but often face prohibitive costs and limited availability: "There are only so many wedding gown manufacturers in this world, especially in our price range" ([09:43]).

Danny Reynolds adds, "The sweeping tariffs take that ability out of their control," emphasizing the loss of autonomy for small business owners who previously could negotiate their own deals ([09:54]).

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6. National Security Council Firings

Shifting focus, Layla Falden reports on the recent firings within the National Security Council (NSC), including the director of the National Security Agency and the head of US Cyber Command. These dismissals are linked to a meeting between President Trump and far-right activist Laura Loomer.

Laura Loomer is quoted stating, "Always we let go of people, people that we don't like or people that we don't think do the job" ([10:56]). Domenico Montanaro, NPR’s senior political editor, provides context on Loomer's influence and her history of promoting conspiracy theories and extremist views. He explains that Loomer's presence has led to a chaotic and destabilizing environment within the White House, indicating a shift towards right-wing acolytes rather than experienced Washington advisors ([12:27]).

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7. Implications for Immigrant Communities

Scott Horsley previews the next segment on the crackdown on immigrants without legal status, highlighting the fear and uncertainty spreading within these communities. This topic will be explored further in the upcoming Sunday story, examining how immigrants are responding to the Trump administration's clear message of strict enforcement ([14:08]).

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8. Conclusion and Future Outlook

As the episode wraps up, the hosts reflect on the significant economic and political changes brought about by Trump's tariffs and personnel decisions. The implications for small businesses, the global trading system, and national security are profound, signaling a period of economic turbulence and political instability.

Howard Lutnick succinctly captures the broader impact: "This is the old Pottery Barn rule. If you break it, you own the results" ([04:47]). As the dust settles, President Trump faces the consequences of his aggressive policies, leaving many uncertain about the future trajectory of the US economy and political landscape.

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Notable Quotes:

• Sarah Wells: "I had to come up with $15,000 of extra cash to release my goods just this last month" ([07:03]).
• Howard Lutnick: "It's a reverse Robin Hood policy, trading taxes for tariffs. It takes money from the poor and gives it to the rich" ([04:53]).
• Laura Loomer: "Always we let go of people, people that we don't like or people that we don't think do the job" ([10:56]).

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This comprehensive overview of the April 4th episode of Up First from NPR provides listeners with an in-depth understanding of the day's most pressing issues, including the sweeping new tariffs and their far-reaching consequences for both the economy and national security.

Transcript

[Layla Falden]

President Trump's tariffs on nearly all imported goods will go into effect at midnight.

[Michelle Martin]

This is the reordering of global trade.

[Scott Horsley]

Will the US Come out ahead or fall behind?

[Layla Falden]

I'm Layla Falden. That's Michelle Martin. And this is up first from NPR News. Small business owners are reacting to the magnitude of the White House's new tariffs.

[Sarah Wells]

I had to come up with $15,000 of extra cash to release my goods just this last month.

[Layla Falden]

How are they thinking about their future?

[Scott Horsley]

And several National Security Council staffers have been fired following a meeting between President Trump and far right activist Laura Loomer.

[Laura Loomer]

Always we let go of people, people that we don't like or people that we don't think do the job.

[Scott Horsley]

Stay with us. We'll give you the news you need to start your day.

[Domenico Montanaro]

Foreign.

[Michelle Martin]

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[Alina Selyuk]

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[Scott Horsley]

From Wall street to Main street, businesses are reeling from President Trump's expanded trade war.

[Layla Falden]

Steep new tariffs are set to take effect at midnight on nearly everything the US Imports. And even higher taxes are due to kick in next week. Big businesses are losing market value, and small businesses feel like they're caught in the middle of something they can't control.

[Scott Horsley]

We're going to talk this through with two of NPR's business correspondents, Scott Horsley and Alina Selyuk. Welcome to you both.

[Alina Selyuk]

Hello.

[Danny Reynolds]

Hello.

[Howard Lutnick]

Good morning.

[Scott Horsley]

So, Scott, I'm going to start with you. Judging by the stock market's reaction, a lot of investors have been really rattled by these tariffs. But you know, Trump had been talking about this for. So why are they so spooked?

[Howard Lutnick]

Yeah, this was a seismic shakeup. The Dow Jones industrial average tumbled more than 1600 points yesterday, or nearly 4%. The NASDAQ dropped nearly 6%. It was the biggest one day sell off in the stock market since early in the pandemic. President Trump has ordered a minimum 10% tax on nearly everything the US buys from other countries. He's also ordered much higher levies on things we buy from China, Japan, the European Union. Altogether we all looking at about a nine fold increase in tariffs now compared to what we were paying last year. And businesses are worried that it's going to cause higher prices for them. For weeks, investors have been waving the caution flag signaling they don't want a wider trade war. But Commerce Secretary Howard Lutnick told CNN the president's not about to change course.

[Michelle Martin]

I don't think there's any chance that President Trump's going to back off his tariffs. This is the reordering of global trade.

[Howard Lutnick]

If these tariffs stick, it's going to upend the global trading system that the US has spent decades building and leave this country more isolated from the rest of the world.

[Scott Horsley]

Scott, how will these tariffs affect the economy more broadly?

[Howard Lutnick]

These tariffs are going to bring higher prices. They're also going to bring slower economic growth and there could be some fallout in the job market. We're going to get the monthly jobs report later this morning. And that could also start to show the impact of the large scale layoffs that Elon Musk's team has been carrying out in the federal government. And remember, President Trump took over an economy that was in solid shape. Unemployment was low, GDP was growing at a respectable clip. Inflation was a little high, but it was much improved from a few years ago. And Trump made the decision to turn over the furniture and kick up a lot of dust. So where that dust settles now is going to be on him. It's the old Pottery Barn rule. If you break it, you own the results.

[Scott Horsley]

And the president says he's also counting on these tariffs to raise a lot of money for the government. Will they?

[Howard Lutnick]

These are high tariffs and they could bring in a lot of money. That's one way the administration plans to make up for the money that the government stands to lose if it extends the 2017 tax cuts. But this is not a simple matter of taking money out of one pocket and putting it in the other tariffs will be paid disproportionately from the pockets of working people. That's who's shopping at Walmart. And paying higher prices for imported toys and shoes and winter produce. Meanwhile, the savings from the tax cuts will primarily flow to the pockets of the wealthy. So this is a reverse Robin Hood policy, trading taxes for tariffs. It takes money from the poor and gives it to the rich.

[Scott Horsley]

And how are other countries responding?

[Howard Lutnick]

Other countries will likely buy less from US Exporters, which will hurt farmers and factories here. What's more, a lot of countries that depend on exports to the United States will, will find it harder to sell their goods here, and they may be pushed towards recession. Trump has ordered tariffs that are not only higher, but also broader than those we've seen before. He's planning to tax all kinds of things that we do not and cannot produce at scale here, like tropical fruit. You know, even with global warming, I don't think we're going to start growing a lot of bananas in the U.S. so we're going to import the bananas, but Americans are going to pay more for them. And nervous shoppers have already started to dial back their spending.

[Scott Horsley]

So we're going to turn to Alina Selyuk now, Alina, you've been talking to small retailers, shopkeepers and suppliers from around the country. What have you heard so far?

[Danny Reynolds]

You know, they feel like collateral damage. The evening when the tariffs were announced, I was actually at a big reception organized by the National Retail Federation. They had scheduled a fly in for small business owners. And when the magnitude of tariffs became clear, it was like shell shock because it's these companies that are on the hook to pay many of these fees. For example, Sarah Wells from Virginia shared her story. She sells purses and clothes for new moms. They're like for breast pumps and breastfeeding. They're made in China. And late last year, she made a huge shipment order. It was loading at the port. When the White House raised tariffs on China by 10% in February, by the time it docked stateside, that tariff was raised again, another 10%.

[Sarah Wells]

And I had to come up with $15,000 of extra cash to release my goods just this last month.

[Danny Reynolds]

And now that the total tariff on Chinese imports is up to 54%, you know, Wells is reeling.

[Scott Horsley]

What do people like her plan to do?

[Danny Reynolds]

You know, one common answer is retrenching and scaling back. Maybe your store shrinks the selection so there's less stuff to ship. Maybe you stop hiring, stop advertising or developing new products, essentially stop growing and go into survival mode. One retailer talked about saving a lot of money in his bank account. It's money that he could be spending on all kinds of things to expand higher market. But now he wants that money to just kind of sit on the sidelines because he expects to pay big tariffs. And then the other answer is what Scott talked about. It's raising prices. Giant companies like Walmart are pressuring suppliers overseas to bear some of those tariff costs, while small retailers, they don't have that kind of muscle. And if they pass the cost to consumers with higher prices, you know, how high can they really go before they start losing sales? Sarah Wells had a grim take.

[Sarah Wells]

Even if we pass some to the consumer, we can't pass it all. So I really think the honest answer.

[Alina Selyuk]

Is that businesses will close and that's.

[Danny Reynolds]

The worst case scenario that she thinks a lot of business owners will have to confront and we'll have to see.

[Scott Horsley]

You know, Alina, one of President Trump's arguments for these tariffs is that they would bring manufacturing back to the U.S. what about these businesses? Can they find suppliers here?

[Danny Reynolds]

There was a lot of discussion about this at the event that I attended. There was actually this moment when a moderator asked a panel of small business owners, including Wells, to raise their hands if they tried to find domestic manufacturers first. And all the hands went up. But the reality is for so many things, you know, clothes, shoes, toys, electronics, the US has not manufactured them at scale in ages or ever. And so, you know, one shopkeeper says she sells work boots. She has American made boots. They are $400. Not everyone can afford that. So she also has imported ones that are half the price or I also talked to Danny Reynolds. He runs Stevenson's Clothing Boutique in Indiana. It sells also wedding gowns. And he says he supports the president's mission to level the trade playing field. He would love to have more US Made gowns. They are great quality, but they're three times as expensive. And all the big bridal gown makers, they're overseas.

[Howard Lutnick]

There are only so many wedding gown manufacturers in this world, especially playing in our price range space. And as a smaller retailer, our hands are kind of tied in this regard.

[Danny Reynolds]

He says business people love to negotiate their deals, make their own decisions, and, you know, live and die by them. And the sweeping tariffs take that ability out of their control.

[Scott Horsley]

That is NPR business correspondents Alina Selyuk and Scott Horsley. Alina, thank you. Thank you, Scott. Thank you.

[Howard Lutnick]

Good to be with you.

[Layla Falden]

The director of the National Security Agency and head of US Cyber Command, General Timothy Hawk has been fired. This according to top Democrats on congressional intelligence committees, Senator Mark Warner of Virginia and Congressman Jim Himes of Connecticut.

[Scott Horsley]

The New York Times and the Washington Post are reporting that the firing is in connection to a meeting between President Trump and far right activist Laura Loomer, during which which she advocated for their dismissal. Now, I want to mention here that NPR has not independently verified this. A number of National Security Council staffers have also been fired, and President Trump is downplaying that move. Here he is talking on Air Force One last night.

[Laura Loomer]

Always we let go of people, people that we don't like or people that we don't think can do the job, or people that may have loyalties to somebody else. You'll always have.

[Layla Falden]

Here with more on the NSC firings is NPR senior political editor and correspondent Domenico Montanaro. Hi, Domenico. Hey.

[Domenico Montanaro]

Good morning.

[Layla Falden]

Good morning. So what do we know about these firings?

[Domenico Montanaro]

Well, Trump confirmed that there were firings at the nsc. For what, we don't know exactly. And the NSC said it wouldn't comment on personnel matters. But all this came after Trump met with Loomer. You know, she's someone who was close to Trump during the 2024 campaign, which raised some eyebrows even among those on the right, because, you know, she's someone who's peddled conspiracy theories or misinformation about everything from COVID to the 2017 mass shooting in Las Vegas and the attempted assassination of Trump. You know, she's called herself pro white nationalist and a white advocate, written racist things about Muslims and former Vice President Kamala Harris that I won't repeat, applauded the deaths of immigrants and a whole lot of other stuff. You know, Trump denied that Loomer was the reason for the firings. He said that she recommended additions. But Loomer herself posted on X one of the many platforms that she'd been banned from before Elon Musk bought it, that she did report people to Trump who she sees as disloyal to him, not necessarily to the country or Constitution. The NSA director and his deputy are among the people she called disloyal people. Her evidence being that they were, she says, recommended by former Chairman of the Joint Chiefs of Staff Mark Milley, who broke with Trump and called him a fascist.

[Layla Falden]

Okay, so what's going on here? What's this all about?

[Domenico Montanaro]

Well, this is the kind of thing Loomer does. You know, she's very online far right activist, bills herself as a, quote, investigative journalist. But what that means is that she goes through people's social media histories their backgrounds and connects dots that are often in conspiratorial ways and puts it all out there. In this case, Trump seemed to be taking Loomer's word over even his national security adviser, Mike Waltz. The New York Times reported that Waltz briefly defended his staff but, quote, it was clear he had little if any power to protect their jobs. Remember, it was Waltz or someone on his staff who inadvertently added that reporter to signal chat group in the first place.

[Layla Falden]

That's right. So what does this say about the people Trump is surrounding himself with and who has influence over him?

[Domenico Montanaro]

Yeah, it's always a question with every president, who they're listening to, who their advisors are. What this tells us is this is a very different group of people around Trump now than in his first term. You know, then there were more established, experienced people, but he really soured on those kinds of folks and moved more toward people in the right wing ecosphere of Trump acolytes and devotees that cropped up with him out of office. And the thing is, on any given day, you just don't know who's in Trump's ear or who he's seeking out. Someone with more Washington experience or someone like Loomer. And that makes for a very chaotic and destabilizing White House.

[Layla Falden]

NPR's Domenico Montanaro. Thank you, Domenico.

[Domenico Montanaro]

Thank you.

[Scott Horsley]

The crackdown on immigrants in the U.S. without legal status has left many unsure what to do this weekend. On the Sunday story, how some immigrants are responding to the clear message that the Trump administration is sending.

[Sarah Wells]

Leave now. If you don't, we will find you and we will deport you. You will never return.

[Scott Horsley]

A look at the fear spreading in many immigrant communities. That's on the next Sunday story from Up First. And that's Up first for Friday, April 4th. I'm Michelle Martin.

[Layla Falden]

And I'm Layla Faldel. Just a reminder, up first airs on Saturdays, too. Aisha Roscoe and Scott Simon will have the news. Look for it wherever you get your podcasts.

[Scott Horsley]

Today's episode of up first was edited by Pallavi Gogoi, Lisa Thompson and Alice Wolfley. It was produced by Ziad Butch, Nia Dumas and Christop Thomas. We get engineering support from Damien Herring. Our technical director is Carly Strange, and our executive producer is Jay Shaylor. We hope you'll join us again on Monday.

[Alina Selyuk]

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