A big conversation before, during, and after the election about the Trump Administration, is the implementation of tariffs. The sad thing is, for as much of a conversation it is, it seems very few people know what a tariff really is or how it will affect the American people.
According to the Council on Foreign Relations, which is an American independent, nonpartisan, and nonprofit think tank about American trade, a tariff is “a tax imposed on foreign-made goods, paid by the importing business to its home country’s government. The most common kind of tariffs are ad valorem, which are levied as a fixed percentage of the value of the imports.”
In short, American business owners will pay extra to buy goods from tariffed countries and the money will go to the American government.
According to NBC News, Trump said, “Other countries are going to, finally, after 75 years, pay us back for all that we’ve done for the world,”
Theoretically, a tariff could cause a level of financial and economic damage to another country when their products are no longer bought. However, American business owners and thus consequently the American people could also be affected.
According to the New York Times, on February 4, 2025; a 10% tariff on all imports from China went into effect. On March 4, 2025; multiple tariffs went into effect. They included a 25% tariff on all imports from Mexico, a 25% tariff on most imports from Canada along with a lower rate for energy, and an additional 10% tariff on all imports from China.
Currently the Trump administration has a planned 25% tariff on aluminum and steel for the world to go into effect on March 12, 2025; an unspecified tariff on all agricultural products for the world to go into effect on April 2, and an unspecified tariff on all foreign cars to go into effect on April 2, 2025. There are also proposed investigations into copper imports and lumber imports for the world.
In response to the proposed tariffs Prime Minister of Canada, Justin Trudeau, has stated that “Should American tariffs come into effect tonight, Canada will, effective 12:01 a.m. EST tomorrow, respond with 25 per cent tariffs against $155 billion of American goods – starting with tariffs on $30 billion worth of goods immediately, and tariffs on the remaining $125 billion on American products in 21 days’ time.”
According to PBS, since the tariffs on Mexico and Canada were placed there has been discussion of the Trump administration creating exemptions, however the Prime Minister of Canada has stated that even if the US policies soften, Canada’s policies will remain in place.
Whether or not policies soften or are eventually removed, all of the world, but especially US citizens will feel the effects of tariffs in daily life.
Sources:
https://www.cfr.org/backgrounder/what-are-tariffs
