End the trade war
The ongoing trade war and the tit-for-tat tariff increases it generates are hurting the hardworking people of New Hampshire. There is a better way: eliminate all the tariffs and enact new free trade agreements, starting with China, where talks already are underway.
When officials in the Trump administration imposed tariffs on steel and aluminum and then on $200 billion in Chinese goods, they told the American people that the levies on imports were in their best interest.
Instead, U.S. tariffs resulted in our trading partners moving to impose their own destructive tariffs in retaliation. The consequences: higher prices for American businesses and families, fewer opportunities for them to sell their products overseas, lost jobs and disrupted supply chains.
Just ask Amy Shafmaster, the manager of Little Bay Lobster Co. in Newington, whose company had been shipping more than half of its catch, or 50,000 pounds a week, to China, but is now losing business. According to Shafmaster, “We ship to China every week, and all of a sudden we didn’t have any orders.”
The tariffs on steel and aluminum are squeezing one of the main drivers of our state’s economy: manufacturing. According to the New Hampshire Department of Transportation, our state has seen a surge in steel prices of about 30 percent since summer 2018. That increase is rippling through the economy.
The cost of a Dover city flood control project – which involves installing hundreds of feet of steel-reinforced concrete pipe under an active railroad track – increased by $1.5 million over the original $3.3 million estimate. These costs, ultimately, will be borne by taxpayers.
Stephen Carter, owner of Williams and Hussey Machine Co. in Amherst, is paying 36 percent more for motors and is seeing demand for his products plummet. He now faces unpleasant decisions: “This is the big question,” Carter said. “How do I absorb those extra costs? Do I pass it on to customers and will customers come back here for business or go elsewhere?” Chris Buchanan, president of Alliant Metals Inc. in Hampstead, said that the price increases on his company as a result of the retaliatory tariffs are “going to be passed on to the consumer.”
The tariffs are also wreaking havoc on supply chains. Val Zanchuk, president of Graphicast, a mold casting company in Jaffrey, said, “The supply chain has taken decades to create – a spider web of countries and companies supplying each other and the right balance between supply, demand, capacity, capability. When you throw something as blunt as a tariff in that mix, it disrupts everything and takes a long time to reestablish those interconnections and in that time you are affected by inefficiencies and cost increases and the loss of relationships.”
Zanchuk added, “It’s a very expensive process and time consuming process to reestablish those types of things. It’s in constant chaos right now. There’s not stable area where people can begin to reestablish those relationships.”
These price increases and supply interruptions expose the tariffs for what they really are: a tax on American consumers and businesses and a barrier to economic growth.
Things could get much worse for the people of New Hampshire, as well as all Americans. Talks with China are continuing, but without a new agreement, President Donald Trump says he will increase U.S. tariffs on Chinese imports from 10 percent to 25 percent on March 1. We can expect to see even higher prices if that increase takes effect. According to research from Trade Partnership Worldwide, families of four could lose anywhere from $767 to $2,294 per year for the next three years. The same report also indicated that our country could see anywhere from 934,700 to 2,235,400 in net job losses in that same period of time. And we can expect to see further retaliation, which will mean even more supply chain disruptions, lost markets and lost economic growth.
The president has said he wants to eliminate all trade barriers. A good place to start would be for the United States to eliminate our tariffs and other protectionist policies, and by forging new agreements with China and other nations to eliminate all trade barriers. That serves the interests of the people of New Hampshire and every other American.
Greg Moore is New Hampshire state director of Americans for Prosperity.