Trump’s trade war: Bad for business

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When President Donald Trump announced a 35 percent tariff on newsprint from Canada, one U.S. company immediately hired 50 people back to run its paper mill. But even as the North Pacific Paper Co. — the sole company complaining about Canadian imports — hired people for its plant in the Pacific Northwest, newspapers across the country responded to the 35 percent cost increase by cutting employees. Reports are that 22 percent of newspapers have already laid off workers because of the tariffs.

If you’re counting, the net job gain from newsprint tariffs: 0.

The jobs lost could go much higher as the price of newsprint — the most expensive part of publishing a newspaper outside of labor costs — cuts into profit margins.

All of this because a single company, Norpac (owned since 2016 by hedge fund One Rock Capital Partners), complained.

If these tariffs remain in place, local papers will suffer — but so will local communities. There could be fewer reporters, photographers and editors to cover local news because smaller papers will be hurt the most. There will be even less representation in towns and cities that don’t draw national coverage — and that’s damaging for democracy, for government transparency, for telling stories about people and places that no one else is telling. (And here’s a thought: Given President Trump’s constant bashing of our country’s free and independent press, possibly the tariff is a retaliatory action against the media he reviles?)

And it’s not just newspapers that will feel the negative effects of his tariffs. The president didn’t stop at just one industry.

Consumers will pay more for products — from booze to appliances — and some industries will be irrecoverably harmed by the tariffs announced against Mexico, the European Union and Canada last week, as well as those for Chinese metal products. Those tariffs include steel and aluminum, and some analysts at Forbes claim imposed tariffs — and other countries’ responses to them — will cost 10 times as many jobs as they create.

Which industries are most at risk? About 2.5 million U.S. jobs in aerospace depend on steel and aluminum imports.  Oil and gas companies use steel for pipelines to build infrastructure; construction costs for homes and buildings will rise, and push the cost of housing even higher. Those costs will be passed on to consumers or absorbed by the company, and could well lead to increased inflation as the cost of goods rises faster than salaries.

There’s not enough steel made domestically to meet demand — plain and simple. And as our allies are responding by creating their own set of tariffs, additional levies on U.S. products from soybeans and corn to Kentucky bourbon (95 percent of the world’s bourbon supply, by the way) will see higher prices at home, harming the industries the government is trying to protect. The EU list is 10 pages long, in fact.

Interestingly, we only get 3 percent of our steel from China, the country that is manipulating its currency and setting an unfair playing field for the rest of the world. We get most of it from Canada — and we have a trade surplus with our neighbor to the north, according to the president’s economic council. It’s bad business policy to engage in one-upmanship with our closest allies, risk our international standing, cost jobs and increase prices for consumers. No one wins in a trade war.

And as the trade wars continue, we’re all going to feel the heat. Buckle up, it’s the beginning of ongoing policies that could swiftly derail economic progress, rapidly increase inflation and cost jobs in every state. This misguided policy could end more than nine years of economic growth and send us into another recession.

Speak up and call Congress to take action to protect free trade, especially with our allies. Donald Trump has us involved in a trade war no one will win.