EDITORIAL: Tariff impacts not just an issue for national stage

Not many people are experts in foreign trade policy, but what’s happening now with tariffs reaches into every home and business in Malheur County. Likely, life is about to get more costly for everyone because of federal government decisions.

President Trump campaigned to bolster American manufacturing and bring home jobs from overseas plants. He’s used a variety of forceful tools to do that, and trade tariffs have moved high up on the list.

He’s been particularly focused on steel and aluminum, intent on giving the fading U.S. steel industry a chance to stabilize and grow. The president is imposing a 25 percent tariff on steel and a 10 percent tariff on aluminum brought into the U.S.

Economists are arguing whether tariffs are good or bad in the long run. Other countries, reacting to the stiffening muscle of American resolve, aren’t sitting idle. They are layering on their own tariffs, meaning anyone buying certain American products in Canada, Mexico or China are seeing their prices go up. On either side of the border, a higher price for an imported good is expected to divert customers to buying homegrown products.

Malheur County doesn’t live off exports to other countries, so their higher tariffs won’t be a big factor here. But the tariffs on goods being brought into the U.S. for sale? That’s where you can expect to see bigger price tags.

How much bigger depends on how nimble American manufacturers are, how much they can tolerate price hikes in their supplies, and how American consumers respond. By most estimates, the increases won’t send anyone screaming out of the grocery store, shocked by the hike in the cost of a can of beer.

But in other quarters, the pricing may be more significant. Caterpillar and John Deere, for instance, put a lot of steel into their machines. Auto manufacturers use on average about one ton of steel per car. Increase the cost of ton of steel, you increase the cost of making that car. You can bet Ford and Dodge aren’t going to absorb the cost. They’ll be tapping consumers for extra money.

And you may feel it in mundane ways as well. A 20 percent tariff has been put on washing machines, and this country imports a lot of them. Check out the aisles at Home Depot. Machine after machine sitting on the floor in Ontario got there via a trans ocean journey. The price of those machines is likely headed up. Some economists say that tariff will particularly benefit Whirlpool, an American manufacturer. The higher costs of the imported models could make Whirlpool’s prices more attractive to U.S. consumers.

Tariffs, though, are a tax. What’s not often discussed is that the federal government collects that extra 10 or 20 or 25 percent. Last year, that amounted to about $44 billion in extra federal taxes – paid by American industry and consumers. With the scale of federal spending, that’s not much but it still seems odd that in a time when reducing taxes is ballyhooed as economic salvation, the country is busy hiking these tariff taxes.

In Malheur County, we don’t have much say in the tariff talk going on now. But that doesn’t mean we should ignore what can be a terribly complex topic. For at the end of the day, these trade disputes put government fingers into your wallet. That’s always worth paying attention to.