Trade Wars Not Easy: We The People Will Be Biggest Losers

I happened upon a recent article in which beer brewers and others complain that the proposed 10% tariff on imported aluminum will most likely impact the consumer price of beer in cans. My first thought was: Great, Ponyshack Cider, a small hard cider brewery in Boxborough MA and a vendor at Wakefield Farmers Market, among other markets, is just starting to transition some of their ciders from glass bottles to cans. I hope that this tariff, if enacted, won’t greatly affect their bottom line. If it does, it could have reverberating effects, from consumer cost and overall sales at their host farmers markets, to monies the cider brewer can offer or afford to pay local farmers for apples and other fruits used for special batches. Although set on the world stage, tariff decisions do more than “trickle down;” they will have a direct impact on each and every one of us.

Here is an except from the article noted above: The policy is intended to increase aluminum production in the US. However, a February 1 letter from the American Beverage Association, Heineken, Pepsico, Coca-Cola, the Can Manufacturers Institute, Molson Coors, and many others cautioned about the unintended consequences of these tariffs.
“A tariff or quota will immediately disadvantage these domestic businesses,” the letter read, “since foreign competitors would have the advantage of not paying an artificially inflated raw cost. We estimate a tariff of 10% on this aluminum would cost beer and beverage producers $256.3 million.”

The even higher 25% tariff on steel will also have serious effects. In a Business Insider article titled: Europe’s largest home appliance maker puts $250 million US investment on hold over Trump’s tariff hike,  “Sweden’s Electrolux, Europe’s largest home appliance maker, said on Friday it would delay a planned $250 million investment in Tennessee, after US President Donald Trump announced tariffs on imported aluminum and steel.”

It is important to note that Electrolux buys all the steel it uses in its US products domestically. “So this is not the possibility of tariffs directly impacting our costs, but rather the impact it could have on the market and that it could damage the overall competitiveness of our operations in the US,” says Electrolux spokesman Daniel Frykholm. He also noted that “We believe that tariffs could cause a pretty significant increase in the price of steel on the US market.”

This tariff nonsense, and that is what it amounts to, is another example of the total ineptness of the current administration.Trade wars are not, as Trump glibly said, “good and easy to win.” There are no true winners in wars of any kind.

Congress can’t stop Trump from imposing tariffs, but hopefully, in the way at least some big corporations are standing up to the NRA, big businesses can get together and hit Trump’s ego and/or affect the family business’s bottom line to keep him in line with sane practices. And maybe all these companies should stop advertising on Fox News so the propaganda that is so hurting our country and allow Trump to maintain his little fan base will no longer have a major outlet. Big wishes, but one can hope.