Nothing President-elect Donald Trump does is ever small. If he does something, it will be major. As he prepares to assume office, he has started to lay out his plans for America’s trade with the rest of the world.
China is expected to be hit hard with tariff after tariff. Currently, there is a 100% tax on importing electric cars to America. This was implemented by President Joe Biden and has been done to protect the American-made car market.
Companies like Ford, General Motors and Chrysler are threatened by cheap Chinese-made electric vehicles that are not only much more affordable than their EVs but also their gas cars. Trump has thrown out the idea of doubling this 100% tariff to ensure Chinese cars do not enter American borders. Outside of EVs, Trump is preparing to put a 60% rate on all Chinese imports.
Trump has also announced his plans to impose a 25% tariff on all Mexican and Canadian imports, which would put an end to the North American Free Trade Agreement. Trump says he is inclined to activate this tariff until Mexico and Canada crack down on drug smuggling, such as fentanyl, and the mass illegal migration into the states.
There are many speculations as to how these tariffs will impact the American people. It is likely that with higher tariff rates, the population will see an increase in the cost of foreign goods to mitigate the tariff’s impact on the companies themselves.
The tariffs are also a way to create and maintain jobs within the country rather than rely on foreign plants and workforces. This notion, however, is not supported by data, as previous tariffs have not expanded the American workforce.
The tariffs are a start to Trump’s plan to “put America first.”