Wall Street is having another tough day amid anxiety over President Donald Trump's often-changing tariff proposals. Trump delayed most tariffs on Mexican goods after talking with their president. But Canada's prime minister said retaliatory Canadian tariffs will remain as long as Trump leaves any U.S. tariffs in place. Alabama may get a momentary reprieve based on the “fine print” in Trump’s latest action on tariffs.
The concern is the possible impact on the Port of Mobile. Professor Peter Simonson, who teaches supply chain management at the University of South Alabama, explained to APR news how car parts, unfinished automobiles, and cars ready for sale move through the port.
"Most of the tariffs go on April the second," Trump said before signing the orders. "And then we have some temporary ones and small ones, relatively small, although it's a lot of money having to do with Mexico and Canada." Imports from Mexico that comply with the 2020 USMCA trade pact will be excluded from the 25% tariffs for a month, according to the orders signed by Trump.
That may be the good news for Alabama, for now. The web site of the United States Trade Representative says car parts are among the Mexican exports that are USMCA compliant. Donald Trump said Thursday that he has postponed 25% tariffs on most goods from Mexico for a month after a conversation with Mexican President Claudia Sheinbaum. Imports from Canada — especially autos and auto parts — that comply with the trade deal will also avoid the 25% tariffs for a month. The potash that U.S. farmers import from Canada will be tariffed at 10%, the same rate at which Trump wants to tariff Canadian energy products.
Tariffs against China could be problematic for Alabama, if the communist country chooses to retaliate. The U.S. China Business Council’s website says Alabama exported close to a billion dollars worth of automobiles to China last year. The state’s Department of Commerce reports that was an eleven percent increase over the year before. If China retalitates, that could mean fewer cars imported, or tariffs could lead to higher prices in China, which could mean less demand. Either way, Alabama could be harmed.
The Associated Press reports the “on again off again” nature of Trump’s trade policy may be cause problems of its own. Marc Rosenberg, founder and CEO of The Edge Desk in Deerfield, Illinois is getting ready to introduce a fancy ergonomic chair designed to reduce customers’ back pain and boost their productivity. He figures the most expensive one will sell for more than $1,000. But he can’t settle on a price, and he is reluctantly reducing the shipment he’s bringing to the United States from China. There’s a reason for his caution: President Donald Trump’s ever-changing, on-again, off-again tariff war with America’s three biggest trading partners – Mexico, Canada and China.
Trump has invoked his power to declare a national emergency — ostensibly over the flow of illegal drugs and immigrants across U.S. borders — to impose tariffs on Canada, Mexico and China with the stroke of a pen. And he’s expanded his targets. Next month, for example, he intends to impose “reciprocal tariffs” on countries that charge higher import taxes than America does.
No word on what’s next on Trump tariffs against China. Tariffs, in Trump's view, are a cure for a number of the nation's ills and the tool to reach new heights. Among the reasons for steeply taxing the U.S. consumption of products from Canada, Mexico, China and beyond are stopping the flow of illegal fentanyl, balancing the budget, making America rich, and protecting "the soul" of America. Most economists see taxes paid on imports as capable of addressing unfair trade practices, but they're skeptical of the quasi-miraculous properties that Trump claims they possess.
