As both Americans and the rest of the world prepare for Trump to return to the White House, uncertainty surrounding international affairs linger. Concerns about the national and global economy seem to be at the forefront of major concerns.
Donald Trump has promised to impose a 20 percent tariff on everything sold to America, including European exports, and even higher tariffs up to 60 percent on Chinese goods. In a Chicago interview, Trump promoted tariffs as beneficial to the economy. “To me the most beautiful word in the dictionary is tariff. It’s my favorite word. It needs a public relations firm,” stated Trump.
Tariffs are used as a tax on imported goods at the border. Historically, they have been used by governments to protect domestic producers and encourage buying domestically made products.
In today’s modern global economy, many products bought by consumers have parts made in another country or were assembled overseas. As a result, tariffs placed in one country can also have an impact on products made in the home country.
Tariffs have earned a bad reputation with many economists arguing they are bad for the economy and ultimately harmful to consumers and small businesses.
Economics Teacher, Erin Klage expressed concern regarding increased costs for small businesses.“Tariffs raise the price of goods ultimately. Local economies might have supply chains internationally, so if tariffs are on these goods, it could raise the cost for small businesses who often have a harder time paying increases in costs,” she commented.
A tax on imported intermediate goods will increase production costs for domestic producers. Manufacturing is likely to be greatly impacted by these tariffs. Everything from electronic companies to clothing companies will be affected as these companies often rely heavily on global supply chains
However, Trump’s tariff proposal doesn’t only affect large corporations, but also will deeply affect the average American household. Trump’s tariff threats would cost the average American family over $2,600 yearly.
“As I am moving out on my own next year for college I’m very concerned about how high prices will be for me. I’m worried the tariffs imposed will cause necessities to be too expensive and out of reach for me, ” expressed senior Becca Hahm.
Agriculture is also at risk, not directly from the imposed tariffs, but from the consequences those tariffs entail. Because of Trump’s high tariffs on globally imported goods, there is a high likelihood that other countries will respond with penalties on U.S imports. Impacting exported goods such as soybeans, pork, or dairy.
“Tariffs run the risk of a trade war. When you put a tariff on another country’s goods, they often will put tariffs on your goods, which means prices will rise for everyone, ” continued Klage.
While Trump’s promise to impose steep tariffs may be aimed at boosting American industries and reducing reliance on foreign goods, the broader economic implications could be far-reaching and damaging. His unstable economic plans hold greater threat to the American people and domestic industries than they do benefit.
