Shortly after the White House announced it was instituting tariffs on imported steel and aluminum, Commerce Secretary Wilbur Ross was on television, holding up cans of Campbell’s soup and Budweiser beer.
The amount of metal in the cans amounted to less than 3 cents apiece at current prices, Ross said. If the tariffs caused the manufacturers’ costs to increase by 25 percent per can, it would amount to about a half-cent each.
It’s meaningless, Ross said.
But tell that to the many sheet metal machinery makers and contractors I’ve talked to in the months since President Donald Trump slapped a 10 percent tax on imported aluminum and a 25 percent tax on imported steel. Prices for domestic and imported metals are increasing — in some cases more than the tariffs. For these companies, it represents a lot more than pocket change. Many are trying to figure how to handle this unexpected jolt to their businesses.
While initially mostly aimed at China, the tariffs now hit metal from Canada, Mexico and the European Union — among the U.S.’ oldest and closest allies and trading partners. Canada is a top consumer of American-made steel — or it was. This has presidents and prime ministers from affected countries reeling, trying to understand why they’re a target of what was initially pitched as a move to boost national security.
Canadian Prime Minister Justin Trudeau has called the tariffs “insulting.”
Canada has readied a list of popular American products to hit with its own import tariffs. Bourbon from Kentucky, Hershey’s candy bars from Pennsylvania, along with lots of construction materials, will now carry levies of 10-25 percent in Canada. The EU and Mexico are expected to do the same with products such as blue jeans and HVAC equipment.
Spats with foreign countries, even allies, over trade policies are nothing new, but this feels different to me and some of the people I’ve spoken to. Few thought Trump would use trade as such a cudgel against friendly nations.
Officials with the United Steelworkers union, which enthusiastically supported Trump’s decision to enact the tariffs, said Canada should have never been part of any tariffs based on national security concerns.
When I started writing about the steel tariffs, I initially thought they might have been so short-lived, they would not even be in effect by the time our summer issues appeared. I shouldn’t have worried.
As for Campbell’s, they blame the tariffs for an expected 6 percent decline in 2018 profits. Doesn’t sound meaningless to me.
May Snipsmag.com poll results
President Donald Trump has given a number of U.S. allies an exemption to the steel and aluminum tariffs. What’s your opinion of the decision?
Orange: It was the right move. Tariffs should not be used against key allies.
Blue: He should not exempt any country. Plenty of allies don’t practice fair trade.
Yellow: The tariffs should never have been enacted.
Green: I don’t know enough about the tariffs to have an opinion.