Trade Cases

Retaliatory Tariffs Aimed at Trump Base
Written by Sandy Williams
October 11, 2018
Retaliatory tariffs are taking aim at those sectors that have been the strongest supporters of President Trump. An analysis of data by the Brookings Institution reports that 6.1 percent of U.S. exports, or $121 billion worth of goods, are now subject to tariffs by China, the European Union, Canada and Mexico.
The Trump administration has levied punitive tariffs of about $250 billion on Chinese goods, as well as tariffs on steel and aluminum exports from its North American partners, the EU and others. China has responded with retaliatory tariffs on over $101 billion worth of U.S. goods. Canada has targeted $12.8 billion of U.S. exports, Mexico $3.5 billion and the EU $3.3 billion.
“Trade policy is inextricably linked with politics, and the retaliatory tariffs seem geographically and industrially targeted to mobilize political angst,” said Brookings.
Agricultural regions in the U.S were hit hard by retaliatory tariffs, particularly in regions of high GOP and Trump support. Pork and soybeans in Sen. Charles Grassley’s home state of Iowa were targeted as were cranberries from Rep. Paul Ryan’s constituents in Wisconsin. Whiskey exports were hit with a 25 percent tariff in Sen. Mitch McConnell’s home state Kentucky. After Trump lauded “made in America” Harley Davidson, the EU targeted the iconic motorcycle manufacturer resulting in the company moving some production overseas.
Retaliatory tariffs also impact the metals industries and certain manufacturing sectors. Regions at the top of the list for tariff exposure include Birmingham, Ala., Nashville, Tenn., and Toledo, Ohio.
Brookings found that counties that voted for Trump are exposed to 8.1 percent of the retaliatory tariffs compared to 4.2 percent of exports from industries in counties that voted for Clinton. Rural and small towns, the Trump base, are hit hardest by tariffs.
Brookings also estimates that tariffs will affect about 294,000 direct export jobs and 354,000 jobs that are supported by the export industry. In total, nearly 650,000 jobs will be impacted by the tariffs. Brookings notes that the numbers are not necessarily estimates of anticipated job loss.
“This analysis provides a look at how regions and states are positioned given their distinctive firms and industries, an important starting point that provides greater understanding to subnational leaders of how a significant macroeconomic policy change influences their place,” said the research firm.

Sandy Williams
Read more from Sandy WilliamsLatest in Trade Cases

Tariff fallout: Canada strikes back, Stellantis idles, GM boosts production
Canada imposes auto tariffs, while automaker Stellantis temporarily idles some plants.

Commerce tags UAE with ‘critical circumstances’ in CORE trade case, South Africa spared
The Commerce Department has made a preliminary determination that ‘critical circumstances’ exist for certain imports of corrosion-resistant (CORE) flat-rolled steel from the United Arab Emirates (UAE). Commerce decided that critical circumstances did not apply to CORE from South Africa. The department also found that critical circumstances did not apply to CORE from UAE producers Al-Ghurair Iron & Steel LLC and United Iron & Steel Company LLC.

Trump’s ‘Liberation Day’ brings 10% baseline tariffs; steel, aluminum, and autos/parts excluded
President Trump’s promised “Liberation Day” has arrived, with a 10% minimum tariff on imports. But there are some very important exceptions: The United States’ USMCA partners, Canada and Mexico, are excluded from the reciprocal tariffs for now. In addition, steel, aluminum, as well as autos and auto parts are excluded from the reciprocal tariffs. That’s […]

Price on Trade: Auto tariffs, auto parts, and Hyundai – a world of rapid changes
Trump's new auto tariffs will apply to passenger vehicles (including sedans, sport utility vehicles, crossover utility vehicles, minivans, and cargo vans), light trucks, and certain automobile parts (including engines and engine parts, transmissions and powertrain parts, and electrical components).

CRU: Canacero urges Mexico-US partnership to fend off Asian steel imports
Victor Cairo, head of Mexico’s steel sector body Canacero and CEO of ArcelorMittal Mexico, says he is confident negotiations between the Mexican and US governments planned for April 2 will lead to the creation of a regional block to substitute imports, especially from Asia.