Proposed tariff hurts local business

Senior+Test+Operator+Joey+McCracken+works+at+Schweitzer+Engineering+Laboratories+on+Sept.+24%2C+2013.

Sulaiman Ambusaidi

Senior Test Operator Joey McCracken works at Schweitzer Engineering Laboratories on Sept. 24, 2013.

RIDGE PETERSON, Evergreen columnist

The tariff that President Donald Trump proposed on Mexican imports would have a negative impact on many U.S. firms and local businesses, and also drive up costs for American consumers.

This tax, which the Trump administration proposed as a way to pay for the wall along the Mexican-American border, would have major implications for Americans, economic sciences professor Mark Gibson said.

“[The tariff] would definitely hurt the U.S. economy, harm consumers, offer limited protection to U.S. firms, and possibly hurt a lot of firms that use imported inputs,” Gibson said.

Mexican producers who have to pay the tariff would raise prices on their goods to make up for the tax. This would cause American consumers to pay more for the same products. In addition, American businesses, who depend on raw materials from Mexico, would either have to raise their prices or face serious losses.

Anything imported from Mexico would become more expensive, from food products to automobile and computer parts.

One local business that has spoken out against the tariff is Schweitzer Engineering Laboratories (SEL). Edmund O. Schweitzer, the founder of SEL, was especially worried about Mexico’s reaction to the tariff and how it would impact jobs.

“A border tax war could lead to a loss of jobs in the U.S. and Mexico,” Schweitzer said in an article in The Spokesman-Review.

A trade war occurs when one country responds to another’s tariff by imposing its own taxes, causing prices to skyrocket in both nations.

If Mexico responds to Trump’s proposed tax by taxing American goods, American businesses will have difficulty selling exports to Mexican buyers. This could lead to downsizing and layoffs for American firms.

Approximately 6 million American jobs depend on U.S.-Mexico trade, according to CNN Money and the U.S. Chamber of Commerce.

Most importantly, this tariff signifies a broken promise on Trump’s part. He told Americans on his campaign trail that “Mexico would pay for the wall,” but if he were to impose this tax, the burden of the tariff would be imposed on American consumers and companies.

All Americans who care about local and small businesses should oppose Trump’s tariff plan, regardless of their opinion on the president himself. Free trade benefits us all, and perhaps instead of building walls that divide us, we should focus on cooperation to bring us together.

Ridge Peterson is a junior marketing and economics major from Woodinville. He can be contacted at 335-2290 or by [email protected]. The opinions expressed in this column are not necessarily those of the staff of The Daily Evergreen or those of The Office of Student Media.