From the Desk of Adam Hill: My Thoughts on the Trump Tariffs
Ever since the U.S. Presidential election, tariffs have been the talk of the industry. This is understandable given that President-elect Trump ran a campaign that was heavily focused on the economy and returning jobs to Americans. His most inflammatory comments regarding the trade industry, however, have revolved around near-universal tariffs on imported goods.
China has been the main target of these threats, but Mexico and Canada have also been mentioned as potential recipients of further tariffs. As we know, the threat of further tariffs led to a rush to import products before inauguration day.
As we approach inauguration day, I wanted to dive deeper into the discourse around the tariffs and share my thoughts on where we stand.
Ever since the first Trump administration China has been portrayed in a negative light, especially when it comes to business practices and trade. Whether you think that’s right or wrong, it has been a constant over the past two presidential administrations, it continues to be that way today, and I foresee it being the same over the next four years as well.
When President Biden took office, many thought he would roll back Section 301 tariffs. As we know, he ended up doing the opposite and raising them further. Now Trump has been using this idea of more tariffs as a campaign tool and negotiation tactic before even taking office. Don’t get me wrong, there is still a strong possibility he will try to impose them, but as it stands, I see them as more of a bargaining tactic right now.
He sees these things as negotiations and uses every tool at his disposal. In the current climate, we run into a variety of things being published and politicized to get the upper hand.
If you look at what’s happening with Mexico and Canada, you could make the argument that his tactics are already working. Prime Minister Trudeau flew to Florida within weeks of Trump threatening to revise the USMCA and increase tariffs on Canadian goods.
Mexico has also already made a statement that they feel they should be treated as an equal in this matter. We’ve also seen Mexico block multiple migrant caravans in the past few months, possibly in an attempt to appease Trump.
So, whether you agree with Trump or not, his tactics already seem to be working, even before taking office. Whether he follows through on his proposed tariffs remains to be seen, but we’re already seeing other countries come to the table in response to these threats.
Finally, I know many people have brought up the USMCA. I understand the concerns that he might try to tear up the agreement, but I also don’t see this as overly likely. He’s the one who created the USMCA in the first place, and while he may try to make some tweaks, I just can’t see him ripping it up entirely.
