October 21, 2025 • 13 mins
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WATCH and SUBSCRIBE on:
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Treasury Secretary Scott Bessent says tariffs aren’t a tax — but try telling that to small business owners crushed under $1.2 trillion in new costs. From shoe importers taking out high-interest loans just to stay afloat to everyday Americans paying more for worse products, this episode of Watchdog on Wall Street exposes how protectionism punishes consumers, stifles innovation, and erodes quality. Chris Markowski breaks down why free trade, not tariffs, fuels excellence — and why letting politicians, not markets, decide what we buy always ends in mediocrity.
Apple Podcasts: https://podcasts.apple.com/us/podcast/watchdog-on-wall-street-with-chris-markowski/id570687608
Spotify: https://open.spotify.com/show/2PtgPvJvqc2gkpGIkNMR5i
WATCH and SUBSCRIBE on:
https://www.youtube.com/@WatchdogOnWallstreet/featured
Treasury Secretary Scott Bessent says tariffs aren’t a tax — but try telling that to small business owners crushed under $1.2 trillion in new costs. From shoe importers taking out high-interest loans just to stay afloat to everyday Americans paying more for worse products, this episode of Watchdog on Wall Street exposes how protectionism punishes consumers, stifles innovation, and erodes quality. Chris Markowski breaks down why free trade, not tariffs, fuels excellence — and why letting politicians, not markets, decide what we buy always ends in mediocrity.
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it we'll have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.
Speaker 2 (00:16):
It was about a week week and a half ago.
Speaker 3 (00:18):
Secretary Treasury Scott Besseent was, you know, being pushed on
tariffs and what they're doing, and he got upset that
they were calling tariff's attacks.
Speaker 2 (00:28):
I don't think it's a tax.
Speaker 3 (00:29):
Well, when you go law when you said, somebody, so,
when you go get a driver's license and you pay
a fee, is that a tax? Yeah, Scott, it is
a tax. Yeah, absolutely, it's attack. You may call it
something else, but it's a tax.
Speaker 2 (00:48):
Anyway.
Speaker 3 (00:49):
Some of the latest stories here tariff costs to companies
this year to hit one point two trillion, consumers taking.
Speaker 2 (01:01):
Most of the hit. That's us. That's sign attacks. Scott.
What would you call it, buddy? Huh?
Speaker 3 (01:13):
What would you call it? I mean you're making as
bend over, grab the ankles. You're smacking us in the ass,
like you know, Kevin Bacon was getting smacked in animal house.
Speaker 2 (01:26):
Thank you, sir, may I have another and you're trying
to call it something else.
Speaker 3 (01:34):
Yeah, Trump's tariffs are going to cost businesses upward of
one point to trillion and twenty twenty five most of
the cost being passed onto consumers. The estimate additional expenses
for companies is probably conservative, so it could be much more.
(01:57):
Another story, small businesses are being crushed by Trump's tariffs,
and economists say it's a warning for the economy.
Speaker 2 (02:07):
You don't wow, Yeah, shocker there.
Speaker 3 (02:09):
Okay, CEO of av universally small footwear company it sells
through retailers like Macy's norths from a DSW said he
to tea out take out a two hundred and fifty
thousand dollars loan to pay his tariff bill on a
container of shoes he imported from India for the holiday
shopping season. He didn't have the cash on hand to
pay the duties, which he said used to be around
(02:31):
seventy five hundred dollars for a similar size container. This
was before Trump's new tariffs. But if he didn't do that,
he wouldn't have anything to sell during the holidays, so
he was faced with choice. Take on the line of credit,
which came with onerous terms like weekly payments and a
(02:52):
thirty two percent interest rate, and raise prices to pay
it back or close the business he spent the last
nine years building. He decided to take out the loan.
I don't know if I do it, I'm going to say,
put myself in this guy's shoes.
Speaker 2 (03:12):
You know.
Speaker 3 (03:13):
Sometimes, again, this happens with small businesses all the time.
People put their their heart and soul into these things,
and then they again, they have a very difficult time,
very difficult time dealing when the the train's different. No
one likes dealing with the actual terrain. I'm sure, I'm
(03:33):
sure this individual is probably hoping and praying that the
Supreme Court will do the right thing and overturn these tariffs.
But then again, you know, Trump will appeal, or they'll
come up with something else to try to keep them.
I don't know, he says. Everybody believes that I'm a fighter,
so I'm fighting it. We reduced some salaries. We had
(03:55):
planned to hire some people we're not going to hire anymore.
That's another aspect as well that I talked about regards
to the jobs market. Jobs in a very difficult time
improving until these tariffs are done away with and I
could go on down the list here. But there's another
thing as well. It was actually a really great piece
(04:16):
put together by a professor what is it, Yeah, Associate
Economics Southeastern Louisiana University. Gentlemen talked about how tariffs make
you pay and this is a great point, great point.
I don't know, maybe I've brought it up here in
(04:37):
the past. I'm not sure make you pay more for
worse products? Why do higher trade barriers result in lower quality?
I guess you know you want to take a look
at this way. Okay, if i'm you know, like I said,
(04:57):
I if I wanted to cut my own hair, Okay,
remember that thing they used to sell, the floby Okay,
if I wanted to cut my own hair, oh, probably
not gonna look too good, right, Quality oftentimes can suffer
when we substitute self reliance and hubris for genuine expertise
(05:24):
of other people. I've learned this the hard way on
a few occasions. You know, if I don't know people, well,
you know, we got all these YouTube videos and all
this stuff. I'm like, nah, yeah, I'll gladly pay somebody
to do this. I'm sure I can figure it out,
But you know what, is it really worth it? In
(05:47):
everyday life, we embrace the reality that different people have
different talents and abilities. You know what, We'll use this example.
I think this is a good one. Okay, uh, we.
Speaker 2 (06:02):
Just watched show.
Speaker 3 (06:04):
Hey Otani, who is a Japanese citizen do something that
no one has ever done before.
Speaker 2 (06:14):
My jaw dropped when I woke up the next.
Speaker 3 (06:17):
Time I saw the headline ten strikeouts and three home runs.
I wow, wow, you know, geez, you know, correct me
if I'm I'm wrong. I mean, do we really need
(06:37):
I mean Otani? I mean we can find an American
to play the field too, right, No, he's kind of
irreplaceable based upon what he does. Why will we do
away with that? He can take a look at the
same thing when it comes to music as well. But
(06:59):
having access and I gines this is colds true with
what kind of terrafs also immigration as well, access to
world class talent and ability is a good thing, not
a bad thing. Free traders apply this basically to all
(07:20):
aspects of foreign trade. Certain countries have certain strengths and abilities.
It's reality, some of these things happen to be You
want to say, basically, built into their system. They might
(07:40):
have the right climate. For example, right climate you know,
you take a look at you know, you know, Tuscany
when it comes to wine areas in France, Yeah, we've
got Napa as well.
Speaker 2 (07:54):
I think about having the.
Speaker 3 (07:55):
Right climate and soil for coffee. You look to someplace
like Columbia, whatever it may be. Other things, it just
so happens to be part of a society's culture. Where again,
they might have those types of craftsmen acquired skills that
we just don't have. Generations of experience. They make the
(08:19):
point you want to think about like Swiss watchmaking or
Scotch whiskey making, German engineering with certain items Italians when
it comes to you know, leather work and shoes and clothing.
(08:41):
Various different factors determine which nations actually excel at producing
these types of talents. You can't snap your fingers and
all of a sudden acquire them. Natural resources, of course,
cannot work that way. Again, this is one of the
(09:03):
reasons why protectionism is a way we're going to erode
quality here in the United States. This is a great
argument they make. Exuppose President Trump imposes steep tariffs on
Colombian coffee. Even if American farmers could ramp up coffee
production by ten thousand percent, they never be able to
replicate Columbia's perfect blend of coffee making ingredients. It's subtropical climate,
(09:27):
volcanic soil, steady rainfall, and high altitude mountains.
Speaker 2 (09:30):
In the end, we wouldn't merely pay more for coffee.
We'd pay more for worse coffee.
Speaker 3 (09:39):
That same logic could be applied to Mexican Avocadosian suits, tying,
and French wines, other imports, countless things that we get here.
Alve oil, I use one again. I have my olive
oil shipped from Italy, Grease, various different plays.
Speaker 2 (10:02):
It's great, okay, world class quality. It's very easy.
Speaker 3 (10:08):
They make this argument, very easy for all of us
to take for granted, but almost impossible to replace. What
you have to settle for is mediocrity. The beauty of
specialization and trade is that we don't have to be
the best at everything to enjoy the world's best quality products.
(10:28):
Free traders ought to deploy this quality argument more forcefully
when discussing the perils of protectionism. Quality matters to an
economy in ways that price and employment statistics can't capture, right,
I mean it makes sense. Protectionism also will rot the
(10:49):
will to build. When you are insulated from foreign competition,
protected industries have less incentive to innovate and improve. Why
strive for excellence when you can lobby politicians for protection
at a fraction of the cost. And again, you can
(11:09):
look at this right now. You can look at it
throughout history, anemic economies. Soviet Union basically sealed itself behind
their little iron curtain there, right, political and economic shutting
down the doors. Again, what was the innovation that they
had going on there.
Speaker 2 (11:29):
That lasts?
Speaker 3 (11:31):
Russia still has those problems today. Now, protectionists may argue
that the quality of many domestic goods has improved over time. Okay, good,
you're not getting any argument there. And they make the
example of American beer. American beer and all the micro
(11:52):
brewers and the IPAs basically catching up to European beers.
But most brew masters would tell you this improvement was
spurred by foreign competition, not protectionist pampering. Foreign brewers pushed
Americans to raise their game. This highlights another crucial aspect
(12:14):
of the quality argument. Trade doesn't merely give us access
to top notch foreign goods. It ensures the quality of
our domestic goods keeps improving.
Speaker 2 (12:26):
Are they wrong.
Speaker 3 (12:29):
We've said this for some time, and I said, I
don't know what's going to happen there at the Supreme Court.
Let markets, let markets, not politicians, decide where true excellence lies.
It's just that simple. Let markets decide, not people in Washington, DC.
(12:57):
Watchdog on Wall Street dot Com,
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it we'll have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.
Speaker 2 (00:16):
It was about a week week and a half ago.
Speaker 3 (00:18):
Secretary Treasury Scott Besseent was, you know, being pushed on
tariffs and what they're doing, and he got upset that
they were calling tariff's attacks.
Speaker 2 (00:28):
I don't think it's a tax.
Speaker 3 (00:29):
Well, when you go law when you said, somebody, so,
when you go get a driver's license and you pay
a fee, is that a tax? Yeah, Scott, it is
a tax. Yeah, absolutely, it's attack. You may call it
something else, but it's a tax.
Speaker 2 (00:48):
Anyway.
Speaker 3 (00:49):
Some of the latest stories here tariff costs to companies
this year to hit one point two trillion, consumers taking.
Speaker 2 (01:01):
Most of the hit. That's us. That's sign attacks. Scott.
What would you call it, buddy? Huh?
Speaker 3 (01:13):
What would you call it? I mean you're making as
bend over, grab the ankles. You're smacking us in the ass,
like you know, Kevin Bacon was getting smacked in animal house.
Speaker 2 (01:26):
Thank you, sir, may I have another and you're trying
to call it something else.
Speaker 3 (01:34):
Yeah, Trump's tariffs are going to cost businesses upward of
one point to trillion and twenty twenty five most of
the cost being passed onto consumers. The estimate additional expenses
for companies is probably conservative, so it could be much more.
(01:57):
Another story, small businesses are being crushed by Trump's tariffs,
and economists say it's a warning for the economy.
Speaker 2 (02:07):
You don't wow, Yeah, shocker there.
Speaker 3 (02:09):
Okay, CEO of av universally small footwear company it sells
through retailers like Macy's norths from a DSW said he
to tea out take out a two hundred and fifty
thousand dollars loan to pay his tariff bill on a
container of shoes he imported from India for the holiday
shopping season. He didn't have the cash on hand to
pay the duties, which he said used to be around
(02:31):
seventy five hundred dollars for a similar size container. This
was before Trump's new tariffs. But if he didn't do that,
he wouldn't have anything to sell during the holidays, so
he was faced with choice. Take on the line of credit,
which came with onerous terms like weekly payments and a
(02:52):
thirty two percent interest rate, and raise prices to pay
it back or close the business he spent the last
nine years building. He decided to take out the loan.
I don't know if I do it, I'm going to say,
put myself in this guy's shoes.
Speaker 2 (03:12):
You know.
Speaker 3 (03:13):
Sometimes, again, this happens with small businesses all the time.
People put their their heart and soul into these things,
and then they again, they have a very difficult time,
very difficult time dealing when the the train's different. No
one likes dealing with the actual terrain. I'm sure, I'm
(03:33):
sure this individual is probably hoping and praying that the
Supreme Court will do the right thing and overturn these tariffs.
But then again, you know, Trump will appeal, or they'll
come up with something else to try to keep them.
I don't know, he says. Everybody believes that I'm a fighter,
so I'm fighting it. We reduced some salaries. We had
(03:55):
planned to hire some people we're not going to hire anymore.
That's another aspect as well that I talked about regards
to the jobs market. Jobs in a very difficult time
improving until these tariffs are done away with and I
could go on down the list here. But there's another
thing as well. It was actually a really great piece
(04:16):
put together by a professor what is it, Yeah, Associate
Economics Southeastern Louisiana University. Gentlemen talked about how tariffs make
you pay and this is a great point, great point.
I don't know, maybe I've brought it up here in
(04:37):
the past. I'm not sure make you pay more for
worse products? Why do higher trade barriers result in lower quality?
I guess you know you want to take a look
at this way. Okay, if i'm you know, like I said,
(04:57):
I if I wanted to cut my own hair, Okay,
remember that thing they used to sell, the floby Okay,
if I wanted to cut my own hair, oh, probably
not gonna look too good, right, Quality oftentimes can suffer
when we substitute self reliance and hubris for genuine expertise
(05:24):
of other people. I've learned this the hard way on
a few occasions. You know, if I don't know people, well,
you know, we got all these YouTube videos and all
this stuff. I'm like, nah, yeah, I'll gladly pay somebody
to do this. I'm sure I can figure it out,
But you know what, is it really worth it? In
(05:47):
everyday life, we embrace the reality that different people have
different talents and abilities. You know what, We'll use this example.
I think this is a good one. Okay, uh, we.
Speaker 2 (06:02):
Just watched show.
Speaker 3 (06:04):
Hey Otani, who is a Japanese citizen do something that
no one has ever done before.
Speaker 2 (06:14):
My jaw dropped when I woke up the next.
Speaker 3 (06:17):
Time I saw the headline ten strikeouts and three home runs.
I wow, wow, you know, geez, you know, correct me
if I'm I'm wrong. I mean, do we really need
(06:37):
I mean Otani? I mean we can find an American
to play the field too, right, No, he's kind of
irreplaceable based upon what he does. Why will we do
away with that? He can take a look at the
same thing when it comes to music as well. But
(06:59):
having access and I gines this is colds true with
what kind of terrafs also immigration as well, access to
world class talent and ability is a good thing, not
a bad thing. Free traders apply this basically to all
(07:20):
aspects of foreign trade. Certain countries have certain strengths and abilities.
It's reality, some of these things happen to be You
want to say, basically, built into their system. They might
(07:40):
have the right climate. For example, right climate you know,
you take a look at you know, you know, Tuscany
when it comes to wine areas in France, Yeah, we've
got Napa as well.
Speaker 2 (07:54):
I think about having the.
Speaker 3 (07:55):
Right climate and soil for coffee. You look to someplace
like Columbia, whatever it may be. Other things, it just
so happens to be part of a society's culture. Where again,
they might have those types of craftsmen acquired skills that
we just don't have. Generations of experience. They make the
(08:19):
point you want to think about like Swiss watchmaking or
Scotch whiskey making, German engineering with certain items Italians when
it comes to you know, leather work and shoes and clothing.
(08:41):
Various different factors determine which nations actually excel at producing
these types of talents. You can't snap your fingers and
all of a sudden acquire them. Natural resources, of course,
cannot work that way. Again, this is one of the
(09:03):
reasons why protectionism is a way we're going to erode
quality here in the United States. This is a great
argument they make. Exuppose President Trump imposes steep tariffs on
Colombian coffee. Even if American farmers could ramp up coffee
production by ten thousand percent, they never be able to
replicate Columbia's perfect blend of coffee making ingredients. It's subtropical climate,
(09:27):
volcanic soil, steady rainfall, and high altitude mountains.
Speaker 2 (09:30):
In the end, we wouldn't merely pay more for coffee.
We'd pay more for worse coffee.
Speaker 3 (09:39):
That same logic could be applied to Mexican Avocadosian suits, tying,
and French wines, other imports, countless things that we get here.
Alve oil, I use one again. I have my olive
oil shipped from Italy, Grease, various different plays.
Speaker 2 (10:02):
It's great, okay, world class quality. It's very easy.
Speaker 3 (10:08):
They make this argument, very easy for all of us
to take for granted, but almost impossible to replace. What
you have to settle for is mediocrity. The beauty of
specialization and trade is that we don't have to be
the best at everything to enjoy the world's best quality products.
(10:28):
Free traders ought to deploy this quality argument more forcefully
when discussing the perils of protectionism. Quality matters to an
economy in ways that price and employment statistics can't capture, right,
I mean it makes sense. Protectionism also will rot the
(10:49):
will to build. When you are insulated from foreign competition,
protected industries have less incentive to innovate and improve. Why
strive for excellence when you can lobby politicians for protection
at a fraction of the cost. And again, you can
(11:09):
look at this right now. You can look at it
throughout history, anemic economies. Soviet Union basically sealed itself behind
their little iron curtain there, right, political and economic shutting
down the doors. Again, what was the innovation that they
had going on there.
Speaker 2 (11:29):
That lasts?
Speaker 3 (11:31):
Russia still has those problems today. Now, protectionists may argue
that the quality of many domestic goods has improved over time. Okay, good,
you're not getting any argument there. And they make the
example of American beer. American beer and all the micro
(11:52):
brewers and the IPAs basically catching up to European beers.
But most brew masters would tell you this improvement was
spurred by foreign competition, not protectionist pampering. Foreign brewers pushed
Americans to raise their game. This highlights another crucial aspect
(12:14):
of the quality argument. Trade doesn't merely give us access
to top notch foreign goods. It ensures the quality of
our domestic goods keeps improving.
Speaker 2 (12:26):
Are they wrong.
Speaker 3 (12:29):
We've said this for some time, and I said, I
don't know what's going to happen there at the Supreme Court.
Let markets, let markets, not politicians, decide where true excellence lies.
It's just that simple. Let markets decide, not people in Washington, DC.
(12:57):
Watchdog on Wall Street dot Com,
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