March 7, 2016
Tariffs on Chinese and Mexican Imports Could Cost Consumers $250 Billion
It is true that the U.S. is a net importer from these countries. To rectify this imbalance, Trump has called for increasing tariffs on foreign goods as a way to encourage American importers to purchase domestic goods. In a New York Times interview from January, the candidate suggested a 45 percent tax on all goods imported from China. Similarly, in his presidential announcement speech, Trump called for a 35 percent tariff on Mexican auto imports to discourage U.S. companies from locating their manufacturing facilities abroad.
A protectionist trade agenda would have dramatic impacts on American consumers. American importers would see their costs increase, which would most likely translate into price increases and reduced access to foreign goods.
Additionally, protectionist policies also disrupt the benefit of imports in today’s global supply chain; a 2014 study from the National Retail Federation found that 25 percent of the value of imported products in 2009 were American made. These massive tariff increases would radically change U.S. trade policy and come with substantial costs.