Will America win the trade war?
It’s been said that no nation wins a trade war, but President Donald Trump disagrees. In March, he said that “trade wars are good, and easy to win.” With the imposition of tariffs today on $34 billion worth of goods imported from China, Mr. Trump will put his theory to the test.
China, which had said it would not “fire the first shot” in any trade war has responded to the American government’s action by imposing tariffs on a like amount of imports from the U.S. with likely targets including automobiles, pork and soybeans.
The Asian nation is not the only front in Trump’s battle, with Canada, the European Union and Mexico all imposing retaliatory tariffs of their own. Earlier this week, Canada placed tariffs on American goods valued at $12.6 billion in response to Mr. Trump’s imposition of levies of 25 percent on imports of Canadian steel and 10 percent on aluminum.
U.S. companies opposed to tariffs are taking steps to protect their businesses while drawing the public ire of the president. Harley-Davidson, the iconic American motorcycle brand, announced that it was moving some of its production outside of the U.S. to avoid some $2,200 being added to the sale price of its bikes in Europe. Mr. Trump has not taken the Harley news well. He recently took to Twitter to announce he is working with some of Harley’s foreign competitors to bring them to the U.S.
Retail industry groups have again voiced their opposition to the actions being taken by government.
“Retailers support a level playing field for America on the global stage, but punishing American families and the millions of American workers whose jobs are supported by trade is not the way to strengthen our trading relationships,” according to a statement issued by the Retail Industry Leaders Association. “This tranche of tariffs on both exports and imports threatens our nation’s prosperity, and will imperil millions of jobs if allowed to persist.”
“These tariffs will do nothing to protect U.S. jobs, but they will undermine the benefits of tax reform and drive up prices for a wide range of products as diverse as tool sets, batteries, remote controls, flash drives and thermostats,” said Matthew Shay, president and CEO of the National Retail Federation (NRF). “And students could pay more for the mini-refrigerator they need in their dorm room as they head back to college this fall.”
- Consumers Are ‘One Step Closer to Feeling The Full Effects of Trade War’ – National Retail Federation
- Retailers Warn Barrage of Tariffs Wil Put Consumer Jobs in the Crosshairs of Global Trade War – Retail Industry Leaders Association
- Trump’s Trade War Against China Is Officially Underway – The New York Times
- Trump doubles down: ‘Trade wars are good, and easy to win’ – CNBC
- Countermeasures in Response to Unjustified Tariffs on Canadian Steel and Aluminum Products – Department of Finance Canada
- Attacking Harley-Davidson yet again, Trump now says administration will boost competitors – Milwaukee Journal Sentinel
- International Trade and Investment – U.S. Chamber of Commerce
- Workers, Farmers, Families, and Business are All Losers in a Trade War – U.S. Chamber of Commerce
DISCUSSION QUESTIONS: How big of an impact will the trade war have on consumer purchasing and jobs in the U.S.? What should retailers do now in light of the Trump administration’s lack of responsiveness to their concerns?