Trade war inflicts pain across US
Industries feel effects of Trump policies
Washington: The effects of President Trump's trade war are beginning to ripple through the US economy as steel tariffs disrupt domestic supply chains and global trading partners retaliate against a wide variety of American products, such as peanut butter, whiskey and lobster.
The cascade of tit-for-tat tariffs has spooked corporate executives, potentially slowing investment, and the Federal Reserve suggested this week that it might have to rethink its economic forecasts if the trade wars continue.
On Friday, Trump only added fuel to the fire when he threatened in a tweet to impose a 20 per cent tariff on all European cars coming into the US if the EU did not remove its auto tariffs. "Build them here!" the President wrote.
Trump, who campaigned on a get-tough approach to trade, has said his tariffs would make trade pacts more fair and ultimately help American workers, farmers, manufacturers and other.
But the situation could soon become politically perilous to Trump, whose trade policies are starting to inflict economic pain across the country, including in areas that are home to the voters who helped him win election.
Business owners across the country are fearing the worst and wondering if Trump, who calls himself a master negotiator, will get the better end of the deal. Here are the ways several American products are being affected.
In the 2016 presidential election, George Skarich, the vice president of sales for the Missouri-based Mid Continent Nail Corporation, voted for Trump and hoped that he would supercharge the economy.
The economy is booming, but Skarich said he was not reaping the benefits. Instead, as a result of Trump's trade policies, Skarich said his nail company may soon be out of business. Mid Continent, the largest American producer of nails, imports steel from Mexico to make its nails. That steel is now subject to the 25 per cent tariffs that Trump imposed on dozens of countries, forcing Mid Continent to raise its prices by nearly 20 per cent.
Orders have plummeted by 50 per cent this month as the company tries to compete with cheaper foreign-made nails. Those foreign manufacturers are not facing higher steel costs, giving them an advantage over Mid Continent.
The company, which employs about 500 workers, has already cut 60 jobs. It could potentially cut 200 more in the coming weeks.
While Trump might propose that Mid Continent simply buy US-made steel, it might not be so simple: Skarich notes that the cost of US-made metal is much higher than what the company had been importing from Mexico.
Skarich, a Republican, has lobbied Senator Claire McCaskill, a Democrat from Missouri, for help.
"He ran on 'Make America Great Again,' and the point was to defend and protect jobs in the US," Skarich said.
"Now here is an action he decides to take that has the potential to cost 500 US citizens their jobs."
New York Times News Service