Stop Blaming Tariffs for Inflation

Inflation vs. Tariffs

If you’ve been following the news the past 6 months, you’ve probably heard a lot of talk about tariffs and inflation. The headlines make it sound simple: tariffs make everything more expensive, therefore tariffs “cause” inflation. But that’s not the whole story. In fact, that framing is misleading—and it hides the deeper truth about where inflation really comes from.

I want to slow this down and explain it in everyday language, because this isn’t just about politics or Wall Street. It’s about how money works, why your paycheck feels squeezed, and why the cost of living seems to jump around in ways that don’t make sense.

Economist Milton Friedman once said, “Inflation is made by government and no one else.” What he meant is that inflation is not just “higher prices.” Inflation is what happens when the government—through the Federal Reserve—creates more money than the economy is producing in goods and services.

Think of it this way: if you double the number of dollars in circulation but you don’t double the number of groceries on the shelves, then each dollar buys less. That’s inflation. It’s not about companies suddenly getting greedy or workers demanding more pay. It’s about the government turning on the printing press.

Here’s where the confusion comes in. Prices can go up for lots of reasons that have nothing to do with money printing.

• A drought can make food more expensive.

• A war can make oil more expensive.

• A new tax or tariff can make imports more expensive.

These are all examples of price increases, but they are not the same thing as inflation. They may hurt your wallet, but they don’t change the total supply of money in the economy.

Tariffs, specifically, are just taxes on imported goods. If the U.S. government charges an extra fee on foreign steel, the price of steel might rise. But no new money was created. The dollars simply get moved around—from consumers or businesses who pay more, to the government that collects tariff revenue.

Why the Language Gets Twisted

So why do so many people—including politicians, journalists, and even some economists—say tariffs are inflationary? It comes down to a change in how the word “inflation” is used.

For decades, inflation meant an expansion of the money supply. Today, inflation is usually defined as a rise in consumer prices (what you see in the grocery store or gas station). That shift in language is subtle but powerful. It tricks people into blaming the wrong causes. If prices rise, the media immediately points to tariffs, unions, or “corporate greed.” But that avoids the uncomfortable truth: the real engine of inflation is government monetary policy.

Federal Reserve Chair Jerome Powell recently admitted that tariffs haven’t had much impact on consumer prices. Importers and retailers absorbed most of the costs instead of passing them all to shoppers. And the inflation data actually shows prices trending lower, not higher.

That’s exactly what Friedman’s framework would predict. Tariffs might shuffle prices around—making some things cost more while others adjust—but they don’t create inflation in the true sense. Only the Fed can do that, by creating more money than the economy can handle.

Why This Matters for You

You might be thinking: “Okay, but why should I care about definitions? All I know is life feels expensive.” Here’s why it matters.

If you believe inflation is just “rising prices,” then you’ll fall for whatever story politicians want to tell. They can blame foreigners, greedy corporations, or even you for living “above your means.” But if you understand that inflation is a monetary problem, then you know exactly where to look: Washington, D.C., and the central bank.

That understanding gives you power. It means you don’t get tricked into fighting the wrong battles. It means you can make smarter financial decisions, knowing what actually drives long-term changes in the value of your money.

The Tariff Debate in Context

This doesn’t mean tariffs are always good policy. They can still cause distortions, hurt certain industries, or lead to trade conflicts. But calling them “inflationary” misses the point. At worst, they create targeted price increases. That’s not the same thing as inflation across the whole economy.

So when you hear the debate framed as “tariffs equal inflation,” remember: that’s a lazy shortcut. The deeper truth is that inflation comes from monetary expansion, not import taxes.

The reason I want to hammer this home is because many of us struggle with financial literacy. I’m not claiming to be an expert by any stretch of the imagination, but I’m learning, and working hard to learn more.

Most people are walking around with a false map in their heads. They think inflation just means higher prices, so they accept whatever narrative is handed to them.

But once you understand Friedman’s point—that inflation is made by the government and no one else—you see through the noise. You realize tariffs aren’t the boogeyman. You see the real issue: how money is created, managed, and devalued. And once you see that, you’re no longer as easy to fool.

Tariffs can be debated. They can be defended or criticized. But they are not inflationary in the truest sense of the word. That responsibility lies squarely with the people who control the money supply.

Don’t let the word games confuse you. Learn the difference. Protect your mind, and you’ll be better prepared to protect your money.