Kumar Bahukhandi
Negative impact of Donald Trump’s tariffs in the US (File Photo: AP)
Although Donald Trump claims that tariffs are in America’s best interest, the extent of their negative impact on the US can be gauged from the fact that bankruptcies among American companies reached a 15-year high in 2025, which is a major cause of concern for President Trump.
While Donald Trump may be making numerous claims to justify the tariffs and portray them as a way to increase revenue in the US, the reality appears quite different. According to reports, corporate bankruptcies in the US have reached a 15-year high this year. Companies are citing the Trump tariffs as a major contributing factor. Furthermore, inflation has exacerbated the situation.
The US figures are shocking.
According to a report in The Washington Post, there has been a significant increase in US corporate bankruptcies in 2025, reaching levels comparable to those immediately following the Great Recession. According to S&P Global Market Intelligence data, 717 companies filed for bankruptcy under Chapter 7 or Chapter 11 between January and November. This is approximately 14% higher than the same 11-month period in 2024 and the highest figure since 2010.
It’s worth noting that Chapter 11 is also known as reorganization, in which a company restructures its debts under a court-supervised process and continues operations. Under Chapter 7, the company is liquidated, and its assets are sold off.
Import-dependent businesses shut down
According to the report, US businesses that were heavily dependent on imports faced the highest tariffs in decades. The largest increase in bankruptcy filings was seen in the industrial sector, which includes construction, manufacturing, and transportation companies. Economists see a paradox in the US economy and say that many businesses are struggling under the pressure of tariffs and other costs.
Most companies that filed for bankruptcy cited inflation and interest rates as contributing factors to their financial challenges. They also blamed the Trump administration’s trade policies for disrupting supply chains and increasing costs.
Trump’s claims are hollow!
President Donald Trump’s constantly changing tariff policies have severely impacted all these sectors. On the other hand, Trump has long claimed that these policies are helping to revive the American manufacturing sector. However, federal data shows that more than 70,000 jobs were lost in the manufacturing sector in the year ending November. This makes Trump’s claims appear hollow.
Such Cases Are Most Frequent Since the Pandemic
The first half of 2025 saw a significant surge in total bankruptcy filings, including those from companies with assets exceeding $1 billion (more than ₹8,980 crore). According to economic advisory firm Cornerstone Research, there were 17 such bankruptcy filings from January to June, the highest number in any six-month period since the Covid-19 outbreak in 2020. Many of the bankruptcy filings came from consumer-facing businesses, including retailers like At Home and Forever 21.
Cornerstone’s head, Matt Osborne, wrote in his report that these large companies cited inflation and interest rates as factors impacting consumer demand and making it difficult to raise capital.
What are the experts saying?
Economists and business experts say that trade wars have put pressure on businesses that rely on imports, which were hesitant to significantly increase prices for their goods for fear of alienating and losing customers.
Jeffrey Sonnenfeld, a professor at Yale University’s School of Management, says these American companies filing for bankruptcy are well aware of the inflation crisis facing average Americans. They are trying to absorb the costs of tariffs, but there’s a limit to how much they can absorb. Companies with pricing power will pass on the costs to customers over time, while others will go out of business. The White House did not respond to requests for comment on this matter.
