Overcoming the Hurdles of Tariffs
Posted June 13, 2019
The administration’s back-and-forth trade policies and near-constant threat of tariffs have left many American businesses and consumers uneasy.
We received some good news last week as President Trump ultimately decided against imposing a new 5 percent tariff on all imported goods from Mexico. But while trade with Mexico might be on even ground for now, the already tense U.S.-China trade relations have shown no sign of letting up. Now, the Administration has threatened a fourth round (subscription publication) of tariffs on Chinese imports, this time on List 4 goods, if a trade deal with China is not reached at the G20 summit later this month.
Let’s take a moment to remember that U.S. consumers are the ones hurt by tariffs, which are a tax on goods that millions of U.S. families and businesses use every day. Studies have shown that the administration’s trade war has already added $69 billion in costs to consumers and producers because of the tariffs the U.S. imposed last year, and over $800 every single second the tariffs remain in place. It has led to $1.4 billion in reduced income for Americans every month, with substantial increases in the price of goods, including a "complete passthrough" of U.S.-imposed tariffs onto imported items. According to the National Bureau of Economic Research, the costs of the trade war falling on consumers has totaled an estimated $303 billion.
To make matters worse, an increase in tariffs could result in a net loss of nearly 1 million American jobs, cost the average family of four $767 and reduce GDP by 0.37 percent – all for a trade war that is already impeding the economy.
U.S. businesses rely on smart trade policies. Our markets are globally connected, and stable policies that support American industries - not tariffs and trade barriers - are in the best interest of American consumers. As the world’s largest producer of natural gas and of oil, globally connected energy markets benefit the U.S., supporting jobs in the natural gas and oil industry and enabling the long-term delivery of reliable, affordable American energy to families and businesses.
About The Author
Mike Sommers is the 15th chief executive of API since its founding nearly a century ago. Prior to coming to API, Mike led the American Investment Council, a trade association representing many of the nation’s leading private equity and growth capital firms and other business partners. He spent two decades in critical staff leadership positions in the U.S. House of Representatives and the White House, including chief of staff for then-House Speaker John Boehner. Mike is a native of Naperville, Illinois, and a graduate of the honors program at Miami University in Oxford, Ohio. Mike and Jill Sommers, a former commissioner at the Commodity Futures Trading Commission, have three children and live in Alexandria, Virginia.
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