By Karen Elias
“LIBERATION DAY IN AMERICA IS COMING, SOON!” This post by the president appeared on Truth Social this past Thursday. It turns out he isn’t announcing some imminent religious Rapture or asking us to celebrate an end to war. Instead, he wants to prepare us for the major escalation of his trade war planned for April 2nd when he intends to impose additional tariffs that, analysts say, will impact trillions of dollars in trade.
The tariff, which President Trump considers “the most beautiful word” in the dictionary, is essentially a tax levied, in our case, on U.S. businesses that are importing goods from other countries. By imposing a tax on foreign goods, the theory goes, these goods will become more expensive, and consumers will begin to demand cheaper American-made products. In the best-case scenario, this will then stimulate domestic manufacturing.
But huge uncertainties remain. American businesses could choose to scale back production. This will mean lay-offs and a possible scarcity of certain products. On the other hand, businesses could decide to pay these tariffs. And since tariffs tend to raise prices, the added costs will inevitably be built into the price of their products and passed on to consumers. If, as some predict, President Trump will end up imposing tariffs on virtually 90% of imports, the cost of a wide variety of essential products will then be passed on to consumers. Some estimate that U.S. households could bear an additional burden of between $1200 and $1700 per year.
As of March 21st, tariffs have been imposed on about $800 billion worth of goods, resulting in an erosion of consumer confidence, a sharp drop in the stock market, and an uptick in anxiety around fears of rising inflation and even a possible recession. Instead of backing off, however, Trump is now raising the possibility of a permanent universal tariff that would apply to most imports, regardless of where they come from.
The uncertainties and mixed messages are causing further anxiety. The president hopes his tariffs will encourage businesses to build factories here in the U.S, but what appear to many to be wildly shifting economic policies do not inspire confidence. Private companies are unlikely to invest significant capital in factory start-ups here in the U.S. if they believe the tariffs might be postponed or eliminated entirely. Start-ups also require a several-year commitment, and it’s possible that the next president might decide to discontinue tariffs and recommit to a more integrated global economy.
So how might tariffs affect the farmer in Lamar who suffered extensive damage in the recent storm? He is already feeling the effects of the president’s tariffs on lumber and will soon be facing increased costs from those on steel and aluminum. New construction might easily be postponed, but emergency building repair from unexpected storms might be unavoidable – and painfully costly. American farmers, in general, are facing several difficulties this year. The Trump administration’s immigration / deportation policies have already reduced the agricultural workforce. U.S. poultry farms have been devastated by the bird flu, with a loss of billions of chickens, as well as a reduction in the market for feed-corn. And counter- or retaliatory tariffs have been imposed on American-grown corn and soybeans, meaning that our export markets will be curtailed, resulting in reduced demand, lower prices and less lucrative profits.
When tariffs were imposed during the previous Trump administration, the markets for agricultural produce went down, and farmers suffered a loss of $27 billion from the reduction in exports, a loss that Trump tried to remedy by sending farmers billions in government subsidies. 76% of all U.S. farms bring in under $50,000 in annual income. According to Forbes, when farm subsidies were given out, these small farmers received, on average, only $5000, while large-scale agricultural operations were handed the bulk of the monies. Small and mid-sized farms are suffering, going bankrupt, even dying off. Farmers are struggling with untreated anxiety and depression, with suicide rates much higher than are found in the general population. Given these realities, tariffs will not help and may, in fact, cause further harm.
In the midst of falling stocks and rapidly escalating uncertainty, the president stands firm on his promise to enact LIBERATION DAY, explaining his planned tariffs by saying, “For DECADES we have been ripped off and abused by every nation in the World, both friend and foe. Now it is finally time for the Good Ol’ USA to get some of that MONEY and RESPECT, BACK. GOD BLESS AMERICA!!!”
The storm is upon us. Where shelter might be found continues to be an open question.
Editor’s Note: This is the second part of a two-part series. Read Part One here.
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