[JSR] The Looming US Trade War

This article was originally published on March 19, 2018
War. It is an atrocious and despicable act of violence between countries. The most notorious examples include World War II and the Vietnam War, both of which resulted in huge casualties. While these kinds of wars undoubtedly bring concern and worry, another kind of war should be on the forefront of the concerns of American citizens: a trade war. As spring looms closer and closer, President Trump is bringing the US even closer to the brink of a trade war.

A trade war should be concerning as it has the potential to significantly affect the American economy. To understand the impacts of this looming trade war, the different elements involved in the trade battle should be examined. According to CNN, Trump signed into effect a “25% tariff on steel imports and 10% tariff on aluminum imports.” Essentially, Trump is imposing taxes on goods coming into the country that were manufactured across the globe with the idea of increasing the prices of foreign goods. Tariffs serve the purpose of increasing the price of imported goods so that Americans look more favorably upon domestic products as prices for American goods will decrease.

While such a proposal may sound good in theory, the potential side effects of Trump’s tariffs are the cause of concern for many American citizens as well as White House officials. The proposed tariffs are intended to increase demand for American products and to prevent foreign countries from introducing cheaper products that will undoubtedly decrease the demand for domestic products. However, these tariffs can have negative side effects with one notable effect being the potential increase in price American consumers may have to pay. Because the tariffs will increase the price of foreign steel and aluminum, manufacturing companies may have to cope with increased production costs. As a result of these increased production costs, companies may make consumers foot the bill as the price of American goods may increase. The tariffs can actually result in the opposite goals of increasing demand for domestic products.

The risk of having more expensive domestic products is not the central issues; jobs and foreign relations are the key areas of focus as a result of the impending trade war. Because companies may have to deal with increased costs in production, many fear that companies will begin to lay off workers to offset this cost increase, leading to more unemployment and affecting the well-being of the US economy. Furthermore, foreign countries, including US allies, may retaliate to our tariffs with tariffs of their own, leading to a global increase in consumer prices. Through a trade war, countries will try to punish each other by raising and imposing tariffs, ultimately raising the prices of domestic and foreign goods. Such increases will make it harder for the average American consumer to buy products as they will have less purchasing power, leading to significant negative effects on the US economy.

The war is looming closer and closer as Trump has decided to go along with his tariff proposal. To see whether or not Americans and the American economy is going to get hurt in the this potential trade war is an important issue that only time will be able to tell.