Economist Mike Walden: The Tariff Debate

The Trump Administration recently put tariffs on imported steel and aluminum, arguing that domestic production of these products need to be protected for national security reasons.  This action has set off strong reactions on both the plus and minus sides.  Give us a summary of the meaning of these tariffs.

  1. If stopped here, not much effect – in fact, for NC, could be positive because we have some steel production facilities
  2. But big worry is over retaliation – that other countries will put tariffs on US exports, which could have adverse impacts on NC’s $13 billion annual export trade
  3. Trump Adm. says domestic steel and aluminum production need to be supported because they are essential to national defense
  4. Others agree, but don’t see any forthcoming situation where that would come in to play
  5. If we get into a trade war – meaning all countries put on tariffs – would cause many product prices to rise
  6. One interpretation is Trump Adm. is using the tariffs as bargaining chips in trade talks with NAFTA partners as well as China
  7. So, important to monitor