Tariffs Are Taxes to be Paid by Consumers

Harley

Steel workers celebrated yesterday when Trump announced tariffs on steel and aluminum. No one else celebrated because we were considering the consequences of such an ignorant action by an ignorant and illegitimate president. Tariffs are taxes, and we, the consumers, will pay those taxes.

For those of you who don’t know how a tariff works, here goes. Tariffs are in reality a tax on exporters from other nations who want to sell their products to American businesses and American consumers. In this situation, Trump is proposing a 25 percent tariff on steel and a 10 percent tariff on aluminum. The goal is to encourage increased production and profit for American businesses which build or grow these same products. Now here’s the problem.

In this situation complete failure will be the result. For example; companies which construct oil and gas pipelines use a type of steel not manufactured in America. Much of the aluminum used for solar arrays comes from outside of the United States. The automobile companies rely on imported steel for much of their construction.

The result will force an increase in prices at the pump, and at automobile dealerships. The cost of converting to solar power will rise exponentially.

The secondary result of this mistake will be retaliation from foreign nations which import products from the United States. For example, Harley Davidson’s primary plant is in Milwaukee, Wisconsin. Wisconsin is Paul Ryan’s home state. The European Union is considering their own tariffs on Harley Davidson motorcycles if Trump and Ryan succeed in applying their tariffs. Other American products which may receive what are actually taxes are bourbon; which is produced in Mitch McConnell’s home state of Kentucky and neighboring Tennessee. Also under consideration are cranberries which are also grown in Wisconsin; Levis, manufactured in California; orange juice from Florida; and peanut butter from Georgia.

Trump has been warned by members of his White House staff and his party that this could begin a ‘trade war.’ His chief financial adviser, Gary Cohn, resigned after Trump’s announcement.

A final statement; “stupid is as stupid does.”

Op-ed by James Turnage

SOURCE

Photo courtesy of Daniel Levy

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