The new tariffs on imported steel and aluminum has raised the alarm in the manufacturing sector. Company owners whose very livelihood depends on the easy flow of materials and steel and aluminum products coming in and out of the country fear what the future will now hold for them. They and economic experts suggest that the tariff could have long-lasting repercussions that ultimately will be to the detriment of the country's security and the American consumer.
The U.S. counts most of Western Europe as its most important trade partner. Both the U.S. and its European trade partners count on each other to ship steel and aluminum materials and products in and out of their countries. Europe in particular benefits economically because it does not cost the countries there much money to ship their products and materials out and to buy and import them from the U.S.
The new tariffs now threaten both the Western European economy as well as the diplomatic relationships shared between Europe and the U.S. European leaders take the tariffs as a snub by President Trump, one that was unwarranted and very much unexpected.
They warn that they will have no choice but to retaliate in kind by levying stiff tariffs against American steel and aluminum imports in a move to safeguard the European economy. In fact, some countries in Western Europe have hinted at diminishing or halting trade with the U.S. because of the steep tariffs that could be signed into effect by Trump.
The new Trump steel and aluminum tariffs also threaten the American economy specifically the domestic manufacturing sector. While there is no doubt that American steel and aluminum companies can produce enough materials with which to continue to build American consumer goods, economic leaders argue that the costs for domestic steel and aluminum could soar in cost.
Manufacturers will have no choice but to pass the increased cost on to the consumer by raising the prices for goods like electronics, cars, and other big ticket items. While finished products like fasteners will not be subject to tariffs, the materials from which they are made will be if they are imported from China, Europe, and other countries aside from Mexico and Canada.
The rising costs for raw materials also could force some manufacturers to slow down their production or go out of business. As fewer people buy higher priced consumer goods, these companies will have no need to buy parts made out of steel and aluminum. The suppliers of the aluminum and steel parts likewise will downsize or go out of business.
In fact, people who say the tariffs could be a good thing may be convinced otherwise when they review what happened the last time that tariffs were imposed against imported steel and aluminum. In 2002, President Bush levied heavy tariffs against imported raw materials.
As a result, more than 200,000 domestic steel and aluminum workers lost their jobs. Their job losses came as the result of fewer manufacturers needing or being able to afford to buy products made from domestic raw materials and materials that were imported with heavy tariffs attached to them.
President Trump promises that the domestic steel and aluminum industries will flourish and few if any American workers will lose their jobs. However, he stands in direct conflict with economic experts who promise otherwise.
Trump has until mid-April 2018 to make up his mind about his proposed tariffs. If they are signed into law, manufacturing experts predict an upheaval of both international and the American economies. They also say that hundreds of thousands of workers will lose their jobs as a result.
Trump's imported aluminum and steel tariffs could turn the American economy on its head, upset international relationships with important trade partners, and raise the costs for goods upon which consumers depend. Few economic experts predict that the tariffs will result in anything positive for people who work in the aluminum and steel industries or people whose livelihoods depend on the unrestricted trade of raw materials.
