The Other Side #70 Tariff Schmariff
If you’ll recall, a few months back when the great America pulled out of the Pacific rim trade alliance, Japan placed a tariff on Missouri beef, hurting Missouri beef producers. Then in March, Trump announced tariffs on steel and aluminum, to bolster our steel industry. Congressman Smith held a press event to heap praise on the President and proclaimed the tariffs would be a boon for the bootheel.
Now China has retaliated by placing tariffs on pork, soybeans, cotton, ginseng, and 100 more products. These are our bread and butter here in SEMO. I don’t see congressman Smith holding a press conference to heap condemnation on the President. The sad difference between the steel and aluminum tariffs and the Chinese tariffs is our tariffs will drive up the price of steel and aluminum and the cost of all products made with steel and aluminum hitting rural farmers in the pocketbook as machinery becomes more expensive.
The Chinese tariffs will drive down the price of commodities that the same farmers sell to make a living. It’s a double hit to rural Missouri. The higher price of aluminum may well open the Noranda smelter, but that is at least three years away, so the workers who are waiting for their jobs to return better plant their gardens and find something to do that isn’t farming. What can we expect next? As the price of consumer products rise from the cost of raw materials, and the economy continues to grow, the Federal Reserve has historically raised interest rates to slow inflation.
They have already raised rates once and I believe that will continue. Higher interest rates combined with the rise in oil prices will result in higher cost of operations and lower spendable income for rural workers. How do you like Trump now? We would have been much better-off had we subsidized steel and aluminum mills directly as China does with their steel mills. This would have kept the price of raw materials low and avoided this trade war. Democrats have a different idea, instead of raising taxes on commodities, repeal the tax cuts for the rich, put that trillion into the pockets of the people in the form of single payer healthcare and saving US employers billions in employee benefits while putting spendable income into workers pockets.
Forget the wall, build highways! There is a direct correlation between new roads and new jobs. This has worked time and time again throughout history while trickle-down has failed. The good news it is only a few more months until the November elections and you can make that happen!
By
Chuck Banks
8th CD Chair, MDP