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President Donald Trump states he will place high new taxes on trade, equaling 10-20% tariffs on all imported goods, and up to a 60% tariff on Chinese goods, plus a 25% to 100% on Mexican goods.
A dozen or more estimates by economists on Trump's tariff policy show they will have a harmful effect on the American economy. The standard findings among economists find that tariffs will have a negative effect on the American economy, leading to a lower standard of living for most Americans.
Tariffs are taxes placed on imported goods at the border when businesses purchase goods from foreign countries. Tariffs increase the price of foreign goods, pushing buyers to purchase domestic goods and providing domestic producers the ability to raise prices. The domestic producers receive higher prices and hopefully higher sales at the expense of the consumers, both the public and the business consumers. Tariffs take income from some and give it to protected businesses.
Protected businesses are not low-cost producers. Tariffs cause less effective production, lowering incomes in the long run.
Tariffs most likely will have an inflationary impact or cause an economic downturn in the short run, in the long run, tariffs bring lower incomes and production.
In the long run, tariffs will shrink the economy by reducing work, investment and reducing productivity. All studies show that Trump's tariffs will have a negative effect on the U.S. economy.
These are facts and can easily be checked out on the internet.
Louis Anthony Mollica
Hollidaysburg