Mar 08, 2018

Freedom Partners Statement: Tariffs Consequences Vast and Serious

Post by Freedom Partners

Arlington, VA – Following the Trump administration’s executive action today to impose tariffs of 25 percent on steel and 10 percent on aluminum, Freedom Partners executive vice president Nathan Nascimento responded by emphasizing the grave impact tariffs of any form would have on the American economy and consumers across the country:

“In no way will tariffs lead to a more competitive economy, nor will they add thousands of American jobs. Harmful trade policies like this will only hurt American consumers and businesses by driving up manufacturing costs and diminishing productivity. History has proven that the unintended consequences of tariffs are vast and serious, and the ones announced today threaten to undermine our growing economy and the relief that millions of Americans are feeling as a result of tax reform.

“Free trade is essential to a thriving economy that provides opportunity, jobs, innovation and growth, and we urge the administration to heed the warnings from economists and policy experts to reconsider these harmful tariffs.”

History Demonstrates That Tariffs Undermine the Economy, Harm Consumers, and Cost Jobs:

Veronique De Rugy, Mercatus Center: Potentially More Than 170,000 Workers Employed In The Steel And Aluminum Producing Industries May Lose Their Jobs As A Result Of New Tariffs. “Like President Bush, Mr. Trump will raise the cost of doing business in steel- and aluminum-consuming companies… Many will lose their jobs — possibly more than the 170,000 workers currently employed in the steel and aluminum producing industries.” (Veronique De Rugy, Opinion, “The Trump Tariffs Will Cost American Jobs,” The New York Times, 03/05/18)

After President Bush Raised Steel Tariffs During 2002, Price Of Domestic Steel And Industry Profits Increased, While 200,000 Lost Jobs; More Workers Then The Steel Industry Had At The Time. “We’ve seen this before. In 2002, President George W. Bush implemented his own steel tariffs. As expected, the taxes jacked up the price of domestic steel and temporarily boosted the industry’s profits. Steel-consuming industries, however, weren’t so lucky. According to an estimate from the nonpartisan Trade Partnership Worldwide, a staggering 200,000 people lost their jobs in downstream industries by the following year. That’s more workers than the entire steel industry had at the time.” (Veronique De Rugy, Opinion, “The Trump Tariffs Will Cost American Jobs,” The New York Times, 03/05/18)

  • Trade Partnership Worldwide: The 200,000 Lost Jobs Translated To About $4 Billion In Lost Wages From February To November 2002. “200,000 Americans lost their jobs to higher steel prices during 2002. These lost jobs represent approximately $4 billion in lost wages from February to November 2002.”(Dr. Joseph Francois & Laura Baughman, “The Unintended Consequences Of U.S. Steel Import Tariffs: A Quantification Of The Impact During 2002,” Trade Partnership Worldwide, LLC, 02/07/03)
  • Trade Partnership Worldwide: Every U.S. State Experienced Employment Losses From Higher Steel Costs With The Largest Losses Occurring In California (19,392 Jobs) & Texas (15,826 Jobs). “Every U.S. state experienced employment losses from higher steel costs, with the highest losses occurring in California (19,392 jobs lost), Texas (15,826 jobs lost), Ohio (10,553 jobs lost), Michigan (9,829 jobs lost), Illinois (9,621 jobs lost), Pennsylvania (8,400 jobs lost), New York (8,901 jobs lost) and Florida (8,370 jobs lost). Sixteen states lost at least 4,500 steel consuming jobs each over the course of 2002 from higher steel prices.” (Dr. Joseph Francois & Laura Baughman, “The Unintended Consequences Of U.S. Steel Import Tariffs: A Quantification Of The Impact During 2002,”Trade Partnership Worldwide, LLC, 02/07/03)