White House press secretary Karoline Levitt announced Friday that President Donald Trump would be implementing 25% tariffs on Mexican and Canadian goods and a 10% tariff on all Chinese imports on Saturday.
Consumers told VOA they were bracing for the possible impact of increased costs.
“I’m concerned about rising prices,” Yon Bui, a student of music and computer science at Middlebury College in Vermont, said in an interview Thursday.
Bui said that while it might still be too early to tell what the impact could be, she has been considering purchasing costly items, such as expensive cosmetics that she buys sometimes, from China. She also said she needed a new phone.
Bui said she would “buy products now before they go up in price to a point where they’d become unaffordable.”
Sean Liu, who lives in Virginia, told VOA that he was glad he’d recently decided to buy a new phone and car.
“With things that are already really expensive, if you add another 10% to their price – it’s not like, say, buying a thermos and adding another 10% – this kind of price hike is truly big,” he said.
He did add, though, that it might be a little easier to deal with if the tariffs came alongside lower prices for more basic necessities like groceries and gas.
‘One very big power’
On the campaign trail, Trump threatened tariffs as high as 60% on China. Since taking office, those threats have expanded and include everything from a universal tariff to threats against trade partners and rivals such as China and Russia.
Last week, Trump threatened Colombia with tariffs of 25% to 50% to get Bogota to accept deportation flights.
On China, Trump recently told Fox News’ Sean Hannity that tariffs were the “one very big power” the U.S. has over China.
“They don’t want them, and I’d rather not have to use it,” Trump said.
The 10% tariff on all Chinese imports is part of what Trump says is a punitive response to China’s role in manufacturing precursor chemicals essential to fentanyl production in Mexico.
Currently, the United States targets China with a 100% tariff on electric vehicles, a 50% tariff on solar cells and semiconductors, a 25% tariff on critical minerals needed to make certain advanced batteries and a 25% tariff on steel and aluminum.
New tariffs would build on more than $300 billion worth of taxes on Chinese imports that Trump imposed during his first term. Those tariffs were upheld and, in some cases, advanced under former President Joe Biden.
Who will feel impact?
Some analysts question who will be hurt if these tariffs are implemented. Some say the deep economic ties between China and the United States could mean that American consumers will be the ones bearing the brunt of Trump’s punishment on Beijing.
Supporters, however, see the move as a fulfillment of Trump’s promise to put American lives and livelihoods first — particularly when it comes to stopping the flow of fentanyl into the country.
According to William Reinsch, senior adviser of the economics program and Scholl Chair in International Business at the Center for Strategic and International Studies, the tariff likely would raise prices of goods in America.
“The prices on a lot of things that people buy at retail — apparel, footwear, household goods – things like that will be affected. Ten percent is not huge, but it’s not zero either,” Reinsch said.
Costs and benefits
Trump has pushed back against the argument that tariffs drive inflation higher and said instead that tariffs would make America rich.
Liu Longzhu, a California lawyer and delegate at the 2024 Republican National Convention, sees tariffs as the key to recovering America’s economic strength.
“The main purpose of increasing tariffs is to assure that America is truly ‘America First’ and protect American jobs. If you are looking for a job, they are beneficial to you. If the tariffs are increased, Chinese products will lose their competitiveness, and American products will become more competitive. This will make it easier for Americans to find jobs,” Liu said.
James Galbraith, an economist at the University of Texas at Austin, doesn’t see tariffs as inherently inflationary, and he agrees that tariffs would bring back jobs that were lost to overseas companies.
“A tariff strategy can be implemented in such a way that the cost largely falls outside of the country,” Galbraith told VOA.
But Stephen Lamar, president and CEO at the American Apparel & Footwear Association, said that tariffs, especially those levied on China, will ultimately raise the cost of both domestic and foreign goods given the interconnectivity of global economies.
“The theory on paper is that you’re giving domestic producers an advantage. The reality in practice is that more people are paying higher prices for products, regardless of their source,” Lamar told VOA.
Reinsch also cast doubt on the ability of tariffs to bring manufacturing jobs back to America, particularly in labor-intensive sectors like apparel or footwear.
“I would be surprised if you see a renaissance in the American apparel industry as a result of a 10% tariff. It would take a lot more than that,” Reinsch said, adding that tariffs don’t guarantee a move away from imports and toward domestic manufacturing.
Importers looking for cheap products can still source from countries in Southeast Asia or Africa that provide competitive, low-cost alternatives to Chinese products.
