Mark Cuban: Trump’s tariffs would burden even the smallest business

Cuban then listed the many steps involved in importing tariffed products according to Grok, the chatbot built by Elon Musk’s company xAI.

A typical business must classify the product it imports and find out the correct tariff, calculate what it owes, file a customs registration, pay the duties imposed, comply with other regulations and keep detailed records, Grok told Cuban. He may need to consult with a customs broker or trade specialist to ensure compliance, he added.

Business owners could also spend time modifying their products and operations to pay lower tariffs, adjusting prices to offset the tariffs, assessing how the tariffs affect their company’s competitiveness, and following trade news to prepare for other changes, the chatbot said.

Threatening rates

Trump, the Republican presidential candidate in November, has proposed 10 percent tariffs on nearly all U.S. imports and tariffs of up to 60 percent on products from rival powers such as China.

At a rally in Wisconsin on Saturday, he floated the idea of ​​imposing 100 percent tariffs on countries that dump the dollar for other currencies as punishment for not doing business with the US.

Trump has pitched his tariff dispute as a tool to strengthen America’s position in global trade and as a source of government revenue that could allow him to cut income taxes.

Cuban, a “Shark Tank” investor and minority owner of the Dallas Mavericks, became a billionaire by founding an Internet radio startup called Broadcast.com in 1995, then selling it four years later to Yahoo for nearly $6 billion.

He criticized Trump’s tariffs on China during his time in the White House and criticized the Republican nominee’s threat of more of the same. He has been a vocal defender of Democratic candidate Kamala Harris and has taken aim at Trump several times.

In an X post on Sunday, he warned that “tariffs in general are inflationary” and “quite stupid” because they could invite economic retaliation from other countries and should have an economic rationale behind them instead of a “personal vendetta”. .

Cuban also warned on X in mid-August that tariff-fueled inflation could raise interest rates, “further exploding the national debt.”

A few weeks later, he acknowledged that the tariffs could prompt companies to move production to the US, potentially creating jobs and pushing down prices. However, he stressed that this is an expensive, years-long process, and some of the materials and components manufacturers need may only be available overseas.

“Tariffs are the worst possible incentive for all but a few products,” he said, adding that they “almost always” cost consumers more money.

Tariff pain and small business misery

Nobel laureate Paul Krugman also criticized Trump’s plans. In a July column, the Economist cited research showing that the tariffs benefit only the wealthiest Americans, with 80 percent of American consumers losing out on a net basis.

He explained that lower-income households spend a larger share of their income than wealthy ones, so they are hit harder by what is effectively a sales tax.

“Everything says the burden will fall on Americans, especially the working class and the poor,” he said.

Cuban’s concerns about the tariffs’ impact on small businesses come at a difficult time for many of them. His “Shark Tank” star, Kevin O’Leary, warned last year that he was struggling to borrow the money he needed to pay his employees and bills after interest rates rose from near zero to more than 5 percent in less than 18 months. “The cost of capital has gone through the roof,” he said.