Back in 2018, Donald Trump slapped tariffs on several imported products and raw materials. The taxes were imposed mostly in an effort to force foreign nations to renegotiate their trade deals with the United States, about which Trump has complained repeatedly. Most significant were the tariffs placed on imported steel and aluminum, as well as a series of escalating tariffs on hundreds of billions in goods from China. The nations affected have responded with retaliatory tariffs on a wide array of products, resulting in a trade war that has made life more expensive for American companies, farmers, and consumers, drawing the ire of lawmakers from both parties.
Though Trump’s tariffs have been particularly hard on the agriculture industry (which was so debilitated that the Trump administration had to set aside $12 billion to bail out farmers last November), they’ve also caused the prices of consumer goods to soar.
Washing machines, for instance. A recent study by two researchers at the University of Chicago and one from the Federal Reserve Board used “the case of washing machines” to demonstrate the effect Trump’s tariffs have had on consumer goods. What they found wasn’t pretty. Since Trump imposed tariffs on washing machines in January 2018, the average price of the appliance has risen 12 percent — or, as NBC News notes, $86 to $92 more per machine.
Though consumers are suffering, manufacturers are doing fine. As the Wall Street Journal points out, Whirlpool recently reported a 400-percent increase in quarterly profits from 2018 to 2019. They attributed the bump to “margin expansion” resulting from “pricing actions.”
According to a study released in March by Columbia, Princeton and the Federal Reserve Bank of New York, Trump’s tariffs are costing American consumers $1.4 billion per month. The researchers note that this was a conservative estimate. Another study released in March found that Trump’s tariffs cost consumers $69 billion in additional costs in 2018. Not nice.
Farmers, whose livelihoods are at stake, are also still getting screwed. In 2018, net farm income tanked by 12 percent. Soybeans, pork, dairy, and wheat have all been crushed. Profits are down, and the price of equipment is up. The hard-luck stories of struggling farmers are countless. There’s Kansas grain farmer Jim Taphorn, whose family had to give up their farm after nearly 100 years. (“We went through the bad times in the ‘70s and ‘80s,” he told Reuters. “In some ways, this is worse.”) There’s Iowa hog farmer Howard Hill, who is bleeding money. (“We have patience, but we don’t have unlimited patience,” he told PBS). There’s Virginia soybean, corn, and wheat farmer John Boyd, who can no longer afford the equipment he needs. (“I haven’t been able to buy anything at all,” he told The Atlantic.) The list goes on.
Trump’s message to struggling heartland has been to be patient, while at the same time questioning the patriotism of those who are tired of waiting. But little progress has been made with China, which the Trump administration seems to think is suddenly going to cave to its demands. Deadlines have been delayed, and any terms that have been agreed upon have been vague.
In March, Secretary of State Mike Pompeo visited Iowa to try to assuage concerns. “The good news is this: Help is on the way,” he told the Iowa Farm Bureau. “American producers and Chinese consumers will both be better off. The outcome of President Trump’s trade negotiations currently underway will pay dividends for people in each of our two countries.”
A few days earlier, Trump tweeted that he “asked China to immediately remove all Tariffs” on agricultural products. They have yet to oblige, of course.
The president has also refused to lift tariffs on imported steel and aluminum, despite pleas from Republican lawmakers who preside over some of the states most affected. One of the most prominent senators to call out the president is Chuck Grassley (R-IA). On Sunday, he even wrote an op-ed for the Wall Street Journal explaining that Trump’s ballyhooed NAFTA rebrand, the USMCA, or the United States-Mexico-Canada Agreement, has no chance of passing through Congress as long as the tariffs on steel and aluminum imports from Mexico and Canada remain in place. “If these tariffs aren’t lifted, USMCA is dead,” he wrote. “There is no appetite in Congress to debate USMCA with these tariffs in place.”
Nevertheless, Trump on Thursday praised the steel tariffs on Twitter. The tweet was posted shortly after he met with Republicans urging him to relax the taxes.
Though Grassley is probably correct that the USMCA has no chance of passing with the tariff still in place — especially considering it will also have to pass in Mexico and Canada — Trump may not even care. He’s already declared victory in rebranding NAFTA, announcing the agreement in a Rose Garden ceremony last October. At rallies, he’s referenced the Village People song “YMCA” as a pneumonic device to remember “USMCA,” which, seven months after he announced it, is nothing more than a piece of paper.
Grassley if perplexed. “The president says it’s a good agreement,” he told reporters before meeting with Trump on Thursday. “If it’s a good agreement, why wouldn’t the president want to pass it? If we don’t pass it, we aren’t going to have credibility for any other negotiation.”
Meanwhile, the tariffs remain in place. Trump may be trying to avoid dealing with the issue until after the 2020 election. Grassley’s constituents like Hogan Hill, the Iowa hog farmer, might not have that long.
Date Posted: Tuesday, May 7th, 2019 , Total Page Views: 990
Like what you're reading? Please help us continue providing you with informative and thought provoking stories by becoming a supporter of Moorenews.net