The push for higher tariffs on imported goods has gained momentum under former President Trump’s influence, but many American business owners are raising alarm bells. Steven Borrelli, founder and CEO of CUTS Clothing, warns that increasing tariffs could backfire on the very businesses they aim to protect.
Borrelli built his athleisure brand from scratch, selling premium t-shirts that now reach customers across the country. “When you’re building a brand in America, you’re already facing steep challenges with manufacturing costs,” Borrelli explained in a recent interview. His company currently produces about 15% of its goods domestically, with plans to increase that number over time.
The problem, according to Borrelli, is that proposed tariff hikes would create immediate financial strain while offering no quick path to bringing production back to American soil. “Manufacturing infrastructure in the US has largely disappeared over decades,” he noted. “You can’t rebuild that overnight with a tariff.”
Analysis from the Peterson Institute for International Economics supports this concern. Their research indicates that a 60% tariff on Chinese imports could cost American households an additional $1,500 annually while potentially triggering retaliatory measures against US exports.
For small and mid-sized apparel companies, the math becomes particularly challenging. Finding domestic manufacturing partners who can handle specialized production at scale remains difficult. “It’s not that American businesses don’t want to produce here,” said retail analyst Maria Chen. “The capacity simply doesn’t exist yet.”
CUTS Clothing represents a growing segment of American startups trying to balance domestic job creation with business viability. The company employs over 50 people in the US for design, marketing, and distribution while working with overseas partners for some production needs.
The tariff debate highlights a broader economic challenge: rebuilding American manufacturing requires long-term investment in workforce training, equipment, and infrastructure. Quick policy changes like tariff hikes may satisfy political talking points but create immediate hardship for growing businesses.
Recent data from the National Retail Federation suggests that apparel prices could rise 15-25% if proposed tariffs are implemented. For companies operating on tight margins, these increases can’t simply be absorbed without consequences.
“We’d love to make everything in America,” Borrelli stressed. “But forcing it through punitive measures before the infrastructure exists puts American jobs at risk rather than creating them.” His company has already begun exploring production options in Mexico and Central America as contingency plans.
Economic historians point to previous tariff experiments with caution. “The Smoot-Hawley tariffs of 1930 were meant to protect American jobs but ended up deepening the Great Depression,” explained Dr. James Richards of Columbia University’s Business School. “When trade becomes more expensive, everyone loses.”
For consumers, the impact would be felt directly in their wallets. Premium t-shirts that currently retail around $50-70 could jump to $80-100, potentially pricing out middle-class customers who form the backbone of many direct-to-consumer brands.
Beyond immediate price increases, tariffs create supply chain uncertainty that makes business planning difficult. “We’re trying to grow American jobs,” Borrelli said, “but we need predictable conditions to make investments and hiring decisions.”
Some industry experts suggest more nuanced approaches, like targeted investment in manufacturing zones, workforce development programs, and tax incentives for companies transitioning to domestic production. These alternatives could support American manufacturing without the shock to existing businesses.
The debate ultimately centers on timing. While many business leaders support the goal of increased domestic manufacturing, they argue that punitive tariffs without supporting infrastructure create more problems than solutions.
As the policy conversation continues, companies like CUTS Clothing find themselves in a difficult position – balancing patriotic desires to support American production with the practical realities of running a sustainable business that can continue employing American workers.
“We want the
