Introduction: After United States President Donald Trump’s so-called Liberation Day unleashed chaos and uncertainty upon the world, the nature and extent of his tariffs have been shifting rapidly. Amidst all the uncertainty, however, a few things are clear.
Many have lost vast sums of money, while a select few have also made windfall gains amid concerns about possible insider trading.
It is also clear that the sweeping disruption, upheaval and uncertainty will have serious implications for the health and wellbeing of nations, communities and people.
Alison Barrett asked a range of experts for their views on what is at stake, and how leaders should respond.
Alison Barrett writes:
Tariffs introduced by the United States are likely to widen inequalities within and between countries, and have wide-ranging harmful consequences for health, leading health experts warn.
They call for targeted, equity-focused policy responses like those seen during the earlier years of the COVID-19 pandemic and 2008 global financial crisis to protect health and wellbeing.
Professor Sir Michael Marmot CH, Director of the UCL Institute of Health Equity, told Croakey the tariffs threaten “the whole spirit of global cooperation which is so vitally important for global health”.
If countries struggle economically, “there will be less money to spend on social goals”, he said.
He was concerned about the impact of tariffs on health inequalities within countries because “tariffs are, in effect, a consumption tax on imported goods”.
Consumption of those imported goods make up a higher proportion of the expenditure of low-income households than of more affluent households, he said.
This means that “tariffs have the real prospect of making poorer households poorer – a result will be increased health inequalities”, Marmot said.
Professor of European Public Health, Martin McKee, at the London School of Hygiene and Tropical Medicine, said leading global economies need to reorient their trade away from the US – “which has shown itself to be impossible to trust”.
McKee would like to see the world come together to restore the rules-based order. “This has consequences beyond the economic, given the impunity with which some governments are engaged in gross human rights abuses and war crimes,” he told Croakey.
“European countries, which are also major donors, also face a potentially existential threat from Russia, so I do not think that we can ask them to reduce defence spending. Indeed, I would argue that there is a strong public health case for increasing it,” he said.
McKee said important lessons could be taken from the 2008 global financial crisis, including the importance of active labour market programs, helping people to retrain and redeploy in the face of unemployment and economic shock.
“This will require active state engagement in many sectors of the community,” he said.
McKee said the scale of the impact from the tariffs is “far from clear”, but given the tariffs are likely to reduce economic growth, less money will be available for health systems and “as always in a crisis, the poor are more at risk”.
Just as in the global financial crisis, much will depend on the response by governments outside the US, according to McKee.
Direct and indirect impacts
Professor Martin Hensher, Henry Baldwin Professorial Research Fellow in Health Systems Sustainability at the Menzies Institute for Medical Research, said the US tariffs could affect health and healthcare through direct impacts on healthcare products and via indirect macroeconomic impacts on the wider economy.
Over coming months and years, the gravest threats to health and healthcare of the US tariff policy for all countries, the US included, lie in their potential macroeconomic and recessionary consequences, he said.
“There is a real chance that the consumption shock of higher priced imports could cause American consumers to rein in their spending sharply, causing a recession in the USA even as prices rise. A US recession may then infect the rest of the world.
“At the same time, major exporting countries experiencing a large drop in their sales to the US may enter their own recessions, with reinforcing impacts pushing down incomes, driving unemployment and reducing government revenues,” he said.
“Indeed, in the enervated panic caused by the Trump tariffs on global financial markets, it is conceivable that a financial crisis might be triggered due to lost confidence; such a financial crisis would then push out into the real economy, damaging livelihoods, health and wellbeing.
“Recessions – or more specifically unemployment and loss of income – are broadly bad for population health. Even more damaging are the austerity policies, especially reductions in health and social welfare funding, that have typically been governments’ response to recession in the neoliberal era.”
Hensher added that a weaker Australian dollar is likely to lead to higher prices for a range of imported healthcare products relatively quickly. On the other hand, companies in some exporting countries facing higher US tariffs may divert some of their exports to other markets (including Australia), increasing supply and potentially causing the prices of some products to drop here.
The impacts on health in a number of low income countries are, however, likely to be much more severe and direct, he said, especially when combined with the termination of large scale US health assistance funding via USAID, PEPFAR and US contributions to other agencies (for example GAVI).
Because of the bizarre method by which the US tariffs were calculated, some low income nations, such as Lesotho, will see their exports to the USA crippled at the same time as US funding for health programs has been terminated, Hensher said.
This double whammy – reduced export earnings and reduced US assistance to key HIV, TB, child and maternal health programs – will undoubtedly cause grave reductions in access to basic healthcare and significant avoidable sickness and deaths in many vulnerable countries, he said.
Australian policy makers need to see the Trump tariffs for what they are – “the capricious act of a standover man, trying to gain leverage to extract concessions”, Hensher said.
They should not apply reciprocal tariffs, which would harm Australian consumers, and they should refuse to “negotiate” anything on the USA’s list of “issues”.
“Sadly, the longer term response to the US tariffs can only be to recognise that the Trump Administration is a capricious and unreliable partner, which has wilfully ignored what were meant to be binding agreements with close allies,” he said.
Once Australia and the rest of the world accepts that they can now simply walk away from the “free trade agreements” that America has nullified via its actions, the possibilities for building a new economic order – and especially one which benefits the global south through fairer trade and the fairer sharing of critically-needed intellectual property – become substantial, Hensher said.
He urged the Australian Government and the Reserve Bank of Australia to plan urgently for bold responses to recession and/or inflation in the US, globally and in Australia.
The early macroeconomic response to COVID-19 – protecting ordinary Australians’ incomes and wellbeing – showed the power of well-targeted stimulus in the face of economic crisis, he said.
However, many in the political, business and economic elites hated the fact that government had to act directly to help individual households, hence the unseemly rapid dismantling of all the COVID-era economic support mechanisms.
“These naysayers need to be roundly ignored as policymakers step up to protect Australians from the economic risks that the USA has now magnified through its actions,” Hensher said.
“At the same time, this should provide yet more impetus for deeper, concerted action to strengthen Australia’s sovereign resilience and capability in key manufacturing sectors, including healthcare, and to build deeper partnerships with our regional neighbours.”
An opportunity for “bold change”
Associate Professor Ashley Schram, School of Regulation and Global Governance (RegNet) and Deputy Director of the Australian Research Centre for Health Equity (ARCHE) at Australian National University, told Croakey that while the “direct hits” from tariffs to Australia may be small, “it’s the ripple effects we need to watch”.
“The health impacts of global trade disruptions may not be immediate, but they are real – and they hit unevenly,” she said.
“In a tightly connected global economy, trade shifts don’t happen in isolation. Massive shifts in tariffs will disrupt supply chains, market competition, and inject uncertainty in investment and pricing decisions across industries – including health.”
This matters for healthcare because global markets shape the cost and availability of medicines, medical technologies and raw materials, essential for healthcare systems, according to Schram.
For example, she said tariffs can raise the price of key medical imports and strain supply chains, as the US – which imports a significant amount of active pharmaceutical ingredients for its manufacturing industry – may face higher manufacturing costs and reduced output, driving up global prices and increasing the risk of shortages.
“Over time, these kinds of pressure can erode health system performance. But the health impacts don’t stop at the hospital door. Trade disruptions affect wages, employment security, food and energy prices, and housing affordability – core social determinants of health that shape people’s everyday ability to live well,” she said.
“Health must be seen as a shared priority across government, not just a sector to fix after the fallout.”
While Australia might be spared the worst, we will likely be exposed to knock-on effects through other countries we depend more heavily on, Schram added.
“As always, it’s the people already on the margins who will feel the shocks the hardest. When the cost of goods rise or services are disrupted, it’s not corporate balance sheets that suffer, it’s households already juggling tight budgets. Inequality amplifies vulnerability.”
Schram told Croakey that we need to build local resilience by investing in strategic domestic manufacturing, taxing powerful industries fairly, and reining in excessive corporate profits so that people aren’t forced to trade off essentials like housing, food and energy.
“COVID showed us that bold, people-first policy is possible when there’s political will – stimulus payments, eviction bans, paid sick leave all happened fast when needed. That lesson matters now,” she said.
“Without targeted, equity-focused policy responses, inequality will grow deeper – and health outcomes more divided,” she said.
Schram emphasised the tariffs are part of a wider pattern of global instability that expose how “fragile and unequal our economies are”. She said the real risk is compounding crises from cost-of-living pressure, climate shocks, political instability and now, trade disruption.
These are not isolated issues, but “signs of deep structural failure”.
“The systems we’ve built aren’t working for the majority of people…Let’s use this moment to rethink how our economy is designed,” she said.
“That starts with asking: what do people actually need to live healthy lives they value? Then we design around that.”
Schram said that means we need strong public services, affordable essentials, and more distributed forms of ownership and governance that aren’t so exposed to global shocks or concentrated corporate power – things like progressive tax reform, investment in public infrastructure, and secure work.
“Without bold change, we’re just patching holes in a leaky boat,” she said.
Mental health
Dr Matt Fisher, Senior Research Fellow at The University of Adelaide, echoed many of Schram’s sentiments.
“Globally, people with less social and economic resources or affected by conflict, wherever they are, will be more vulnerable to the health impacts of economic volatility or downturns,” he said.
“In some ways I suspect that lower income US residents are among those most at risk, with a sustained ‘trade war’ seen as likely to push the US into recession and trigger inflation, worsening already deep socioeconomic and health inequities. Around 37 million people in the US already live in poverty. In other countries, effects may vary widely, and risks are difficult to judge.”
He told Croakey that if the financial market losses start to impact the real economy, there are prospects for continued rises in cost of living, along with unemployment, both of which will undermine public health.
The immediate health impacts of Trump’s tariff regime in Australia are likely to be on mental health, according to Fisher, through increased stress resulting from an atmosphere of threat, social division and uncertainty.
Fisher said, “While the economic issues dominate, it may be time governments are not spending on more important threats to health such as climate change or another pandemic”.
In general, health inequalities globally and in Australia have been increasing over several decades, he said.
“If tariffs and resultant economic turmoil adversely affect known determinants of inequities such as poverty, financial or housing insecurity, employment conditions, unemployment rates or food insecurity, then health inequities can only increase.”
As Croakey reported last year, a series in The Lancet on public health approaches to suicide prevention highlighted the importance of economic circumstances, including unemployment and poverty, on the mental health and suicide risk of populations and individuals.
Suicide rates often rise during periods of economic downtown, the authors wrote. This has been seen during and following the Great Depression in the 1920s and 1930s and the 2008 global economic crisis.
Role of civil society
Fisher urges the Australian Government to use the opportunity of a “tariff-driven crisis” to step out of AUKUS and the chaining of Australian foreign policy to perceived US interests.
He also hopes to see “civil society leadership stimulate public debate questioning the neoliberal consensus and corporate power and examining genuine alternatives for our future”.
“I would argue that such leadership and debate must centre on foundational concepts of wellbeing and a wellbeing economy,” he said.
Professor Linda Slack-Smith, School of Population and Global Health at The University of Western Australia, also emphasised the important role of civil society in advocating for actions that strengthen our public health.
Slack-Smith told Croakey this includes having a strong focus on prevention, examining supply chains including for medications and medical equipment, a strong Centre for Disease Control for advice and public health action, and clear communication from government around what is happening.
Also, she said, “accountability is really important”. For example, government decisions should be made for people’s health, rather than vested interests.
She said the tariffs are occurring alongside other major challenges arising from US actions including reduction in aid, research and key public health personnel.
Uncertainty around these events may result in increased mental health concerns and reinforces the need to focus on prevention in health, reducing demand on healthcare and medication at individual and population levels, according to Slack-Smith.
Priority populations, including older adults, are most at risk, she said.
Dr Jo Flavel, Senior Research Fellow at The University of Adelaide, told Croakey that people on lower incomes and people with chronic health conditions are most at risk in the current circumstances.
The Reserve Bank’s slowness to cut interest rates and lack of recognition that much of recent high inflation was profiteering and from the supply side has been detrimental for people on low and middle incomes. If the indirect effects of tariffs result in any increase in costs, that will put a lot of pressure on people struggling to pay for essentials, she said.
Flavel flagged concerns about disruption to supply chains.
“Pharmaceuticals and medical supplies are very dependent on international supply chains – in a global trade war these can be disrupted and costs of some components of medicines may rise,” Flavel said.
Aside from the impact on healthcare, tariffs impact incomes through rising costs of goods and services, she said.
“People in the US will pay more for all imported goods – tariffs mean imported goods that were cheaper than US made goods are now going to be more expensive than they were.
Countries imposing reciprocal tariffs will also make imports more expensive for their residents as well.”
“Nobody wins in a global trade war,” she said.
Ripple effect
Dr Katherine Trebeck, writer-at-large at University of Edinburgh and a political economist, also highlighted the ripple effect of the tariffs – “many of which are hard to see now as things are so fluid”.
She told Croakey the tariffs come at a time when economic inequality is dividing communities, and our planetary home is at breaking point.
While so much is unclear, we can be sure that anything which makes people’s jobs more precarious, which raises the costs of basic goods without parallel increases in income, and which puts more money in the pockets of the “wealthy-enough” will harm those who are already struggling, Trebeck said.
“From a gig economy worker in the north of England to a farmer in southern Rwanda, when economic policies create uncertainty, when they make putting food on the table harder, and when they undermine governments’ capacity to provide critical public services such as education, health, water and housing, peoples’ health will be undermined,” she said.
Fisher hopes that “Trumpism in the US might incentivise policy makers in other countries to re-think the dominance of corporatised, neoliberal globalisation with all its inherent vulnerabilities to ‘shocks’ whether in the form of tariffs, military conflicts, pandemics, or climate change impacts”.
In many ways, he said, Trump is not an aberration but an extension of neoliberal policy and rhetoric over decades.
“I would hope to see Australia and other countries moving toward greater independence in foreign policy, and more resilient, diverse, sustainable domestic economies,” Fisher said.
While there is debate about how best to respond to Trump, Professor Martin McKee said his personal view is that “appeals to reason will be pointless”.
“He has shown a complete disregard for the consequences of his actions and while it is beyond my ability to understand what is going through his head, I see little to be encouraged by,” McKee said.
He thinks there is a strong argument for standing up to Trump, as it’s likely he sees “any weakness as something to be exploited”.
“We have credible evidence of insider dealing on a massive scale by those around President Trump so, once again, there will be some people who do very well out of the crisis.”
Global inequity
McKee said that while the tariffs will have implications for countries at all levels of development, it is likely to be most devastating for poorer trading nations like Vietnam, which was going to be hit with a tariff of 46 percent.
“It is impossible to disentangle what [Trump] is doing from his other actions, in particular, his cuts to International Development Assistance and his dismantling of scientific institutions in the United States,” McKee said.
Karen Mathiasen, Project Director for the Center for Global Development, and Nico Martinez, Research Assistant for the Center, said the tariffs will likely have a disproportionate impact on the poorest countries.
“It is hard to fathom that the Administration set out to destabilise poor African countries and unclear what they hope to gain,” Mathiasen and Martinez wrote.
Given the region is already reeling from Trump’s closure of USAID, the tariffs are likely to have far-reaching and significant impacts in Africa.
According to Stephen Howes, Terence Wood and Rubayat Chowdhury in DevPolicyBlog, the direct impact of the tariffs on the Pacific Island nations will likely be limited.
“The Pacific is not a large goods trading region, and most countries neither export nor import much from the US,” they wrote.
The bigger impact on the Pacific Island nations will result from the overall global impact of the tariffs, especially in the event of a US or global recession, they said.
Access to medicines
Dr Elizabeth Deveny, CEO of Consumers Health Forum of Australia, said on LinkedIn that while nothing has changed now with the PBS or the cost of medications, there are two main risks:
- As a part of lobbying, US-based companies might delay, or even withhold, submitting new medicines for PBS listing, which could mean longer waits or missed treatments for patients
- There’s a risk the PBS could become a bargaining chip in trade deals. In a worst-case scenario, the US might push Australia to alter our PBS rules in exchange for easing tariffs on other exports like steel or beef.
However, she added, there is strong bipartisan support for the PBS. “Our political leaders agree that the PBS is not up for negotiation. But systems like the PBS only stay strong when we pay attention and speak up,” she said.
“The PBS isn’t a bargaining chip. It’s the foundation of our health system, and we must keep it that way.”
Wide-ranging risks
Emergency medicine physician Dr Simon Judkins told Croakey that he is concerned about the impacts of the tariffs on health systems globally and particularly in those countries where healthcare is run “on the edge of a precipice”.
As with other experts, Judkins highlighted the impact on countries already experiencing huge losses due to the USAID cuts.
“In order to afford any level of healthcare – and education, housing etc – many governments would be relying on the income they derive from whatever exports they have,” he said.
He told Croakey that the combination of cuts in aid – and the significant impacts on the financial stability of countries in Africa, Asia and other areas reliant on a system of trade and international collaboration and supports will potentially “see the collapse of healthcare” in these countries.
“Again, those with wealth, privilege and resources will be OK…they will be able to get the care they need through connection and capital,” Judkins said.
“The poor, the socio-economically disadvantaged, those who rely on the goodness of others, on empathy, humanity and a belief that healthcare is a right, not a privilege, will wear the impacts, with an undoubted rise in morbidity and mortality brought on by one man and his sycophant’s greed.”
Judkins highlighted some companies in Australia that may be impacted by the tariffs – including CSL, Cochlear and others that export product and technology to the US.
If he was in a position of influence, Judkins said he would be “strongly advocating for a huge investment in scientific and medical research in Australia” to attract researchers and clinicians who may have lost their funding or positions in recent months.
“This would be a dramatic reversal of the Australian approach to research and development, but a reinvestment in the ‘clever country’ is a huge opportunity and must be looked at very closely,” he said.
See Croakey’s archive of articles on the social determinants of health.
