By Sofia Mason. When asking students around the campus the question, “Do you know what a tariff is?” approximately 70% of students asked did not know. Some students had heard of tariffs but did not understand the definition of it. If you ask Trump what tariffs are, he will tell you that tariffs are, “the most beautiful word in the world.” Tariffs are something every American needs to be educated on quickly because it’s about to affect our lives these next four years.
So what is a tariff? To put it simply, tariffs are taxes put on certain countries’ goods or items that are being imported or delivered to the U.S. These goods could be anything from cars built overseas or something simpler like your groceries. Regardless of what the item being imported is, it will affect us all. The countries in question are Canada, Mexico and China. While Trump says that the countries in question will “pay for the tariffs themselves,” Katherine Viner of The Guardian notes that economists agree that, “tariffs are actually paid by American companies that import goods from abroad.”
This is how all tariffs work and the American people will be affected by them, not just the other countries.
Trump calls tariffs, “the most beautiful word in the world,” and campaigned on the promise that “his plans would rebuild the U.S. jobs and incomes and earn trillions of dollars in federal revenues over 10 years,” wrote Lewis Krauskopf for Reuters.
Factually, the consensus among economists is that tariffs will increase inflation and could prompt the loss of as many as 800 thousand American jobs. Zach Moller in an article for Third Way highlights some of the macro effects of this tariff plan: “The Center for American Progress estimates that families will face $1,500 in additional costs due to the broad 10% tariff and $2,500 for the China-specific tariff. Inflation will also increase by 1%.” Also, “The Tax Foundation estimates that 825,000 jobs will be lost, and the United States will see a 1.1% loss in GDP.”
Not only are tariffs costly for everyone, but the proposed plan violates a trade law. Mexico and Canada are America’s top trading partners, by a longshot amassing 356.5 billion traded from Canada to America and 324.3 billion traded from Mexico to America in 2022, via United States Trade Representative. Costas Pitas of Reuters details in his article that, “Trump’s threatened new tariffs would appear to violate the terms of the U.S.-Mexico-Canada Agreement (USMCA) on trade. The deal which Trump signed into law took effect in 2020 and continued the largely duty-free trade between the three countries.” Simply put, Trump plans to violate his own agreement with this newly proposed plan. The USMCA’s main purpose is summarized by the
United States Trade Representative, “The USMCA, which substituted the North America Free Trade Agreement (NAFTA) is a mutually beneficial win for North American workers, farmers, ranchers, and businesses. The Agreement creates more balanced, reciprocal trade supporting high-paying jobs for Americans and grow the North American economy.” It further details that it is supposed to benefit “American farmers, ranchers, and agribusinesses by modernizing and strengthening food and agriculture trade in North America.” With this new tariff deal Trump is undoing the progress he was trying to make with USMCA. America’s economy will change greatly beginning January 20th and the 4 years onward.
Hopefully, this article educated you on one of the many policies Trump has employed sooner than you might have expected!
