Wednesday, October 16, 2019

The Spillover Effects of the Trump Tariffs

Thanks to this posting at, we have an idea of how much the Trump tariffs are costing American consumers.  While the tariffs are being imposed to punish China for this:

...and this: fact, the escalating tariffs imposed by China, the source of much of America's consumer goods, is having a negative impact on American consumers.  Calculations by show that the degree to which states will feel the greatest negative impact of the tariffs imposed by China states and which states will feel a relatively negligible impact.  Obviously, the level of impact varies with the degree to which that state's economy is reliant on exports to China.  The data for this analysis is sourced from the United States Chamber of Commerce (cost of tariffs), the Bureau of Economic Analysis (state GDP) and the International Trade Commission (value of state exports). 

Here is a list of the ten states which have the largest impact from the tariffs imposed by China along with data showing the value of exports as a percentage of the state's total GDP:

1.) California - $13.4 billion (6.00 percent)

2.) Texas - $10.6 billion (17.79 percent)

3.) Washington - $7.5 billion (13.85 percent)

4.) Louisiana - $7.1 billion (26.69 percent)

5.) Illinois - $5 billion (7.57 percent)

6.) South Carolina - $3.9 billion (15.03 percent)

7.) Alabama - $3.4 billion (9.69 percent)

8.) Ohio - $3.2 billion (8.05 percent)

9.) New York - $3.1 billion (5.05 percent)

10.) Pennsylvania - $2.7 billion (5.22 percent)

Here is a list of the ten states which have the smallest impact from the tariffs imposed by China:

1.) District of Columbia - $2 million (1.94 percent)

2.) Wyoming - $37 million (3.45 percent)

3.) North Dakota - $53 million (14.43 percent)

4.) South Dakota - $63 million (2.79 percent)

5.) Hawaii - $96 million (0.72 percent)

6.) Vermont - $112 million (8.66 percent)

7.) Montana - $117 million (3.40 percent)

8.) Rhode Island - $185 million (3.94 percent)

9.) Oklahoma - $200 million (3.05 percent)

10.) Maine - $223 million (4.41 percent)

Here is a map showing the export tariff impact on each state and the value of exports as a percentage of each state's GDP:

Obviously, the cost of tariffs imposed by China will, in one way or another, be borne by American consumers.  Studies suggest that the cost to individual households will be approximately $1000 per year, particularly given that the tariffs imposed on September 1, 2019 included a 15 percent tariff on $125 billion worth of Chinese goods including footwear, smart watches, flat-panel televisions and other items frequently purchased by American consumers.

If we want to know who is really to blame for China's ascendance and America's descent, we need look no further than this gentleman who proclaimed this while residing in the Oval Office:

His unceasing promotion of a global trade deal with China led directly to this:

Why is it that Main Street America always pays the price for Washington's agenda?  If we want someone to blame for the current situation we need look no further than Corporate America whose leadership transferred millions of jobs to overseas locations where the cost of labor was a fraction of what it cost in the United States, all in the name of higher profits, elevated stock prices and enriched compensation for executives.

1 comment:

  1. It is time we have a real conversation and admit trade is no longer a big driver or force moving America's economy forward. Compared to what we import we simply do not export that much. In many ways, trade should be seen as a way to increase access to a greater variety of goods at a better price but this only works over a long period of time if it is balanced.

    The promise that increased trade will create new jobs has turned out to be largely a myth. Much of the "free trade" movement is driven by mega-companies desire for larger markets and greed. The article below questions the role of trade in our economy.