What The Trade War Means For Regular Americans

Monday, October 1, 2018
By Paul Martin

Mac Slavo
October 1st, 2018

What does the trade war mean for the average everyday working American? It means higher prices on goods, lost jobs, and economic downturns if the tariffs continue.

President Donald Trump’s steel and aluminum tariffs are particularly concerning for the public. They are bad news for the much bigger sector of the US economy that buys those metals to use them in the goods they produce, according to Quartz.

Take steel, for instance, which is used to make cars, cans, trains, and planes. The pillars of American infrastructure are made of steel, from office buildings to bridges; so are the cranes, excavators, and other machines that build those things reported Quartz. Steel equipment extracts the oil and gas needed to produce all of this stuff. Steel also forms the pipes through which oil and gas flow. US steel-consuming manufacturers dwarf the US steel industry, with more than 6.5 million workers. Facing higher prices for foreign steel under the Trump tariffs, steel consumers have three terrible options. They can absorb the cost and fire workers, they can absorb the cost and lower their profit margin, or they can pass on the cost to customers.

Most companies aren’t going to lower their own profit margin, so the other two options, which affect the American public the most, are the ones that will have the greatest impact and be most likely.

Wilbur Ross, the US secretary of commerce, is trying to convince the American consumer that they won’t be affected by the trade wars all that much. (Tell that to the guy who lost his job…) Ross is using that argument in an attempt to clam the fears of American people. The direct effect of the tax is that most likely that prices will go up only marginally, so he’s right it won’t hit that hard. Unless you already have no disposable income. And Ross forgets something else too.

The Rest…HERE

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