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President’s Visit to Tennessee on Sunday Highlights Sting Caused By Latest Wave of Tariffs

November 2, 2018

Across Tennessee, Businesses, Workers and Families Facing New Taxes Thanks to Recent Trade War Escalation

QUOTE FROM TARIFFS HURT THE HEARTLAND SPOKESMAN BRIAN KUEHL: “The longer this trade war goes on, the worse it will get for Tennessee. Tariffs have already caused long-term damage to farmers who rely on exports to make a living. Their overseas markets are disappearing – possibly for good. Now we are seeing the negative effects throughout Tennessee’s economy. It’s clear that the trade war needs to come to an end before the pain gets any worse.”

HEADLINE: ‘TARIFFS ARE HURTING TENNESSEE.’ “Mexico, Canada and the European Union all imposed tariffs on U.S. whiskey exports in retaliation for President Trump’s steel and aluminum tariffs. And China imposed 25 percent tariffs on U.S. whiskeys in response to the growing trade war between the two nations. … Tennessee farms that export to China and businesses that rely on steel and aluminum imports are being squeezed. Leah Askarinam, with the Washington newsletter Inside Elections, has looked into the impact of tariffs on voters and said a lot of farmers and small businesses in rural red states are concerned.” (Jason Margolis, “Tariffs Are Hurting Tennessee, But Is It Enough To Turn Deep-Red Tennessee Blue?” Public Radio International, 10/28/18)



MTSU STUDY: AUTO EXPORTS DECLINE AS TRADE WAR HITS TENNESSEE. “Tennessee’s exporters had a somewhat ho-hum second quarter, according to the latest ‘Global Commerce’ report from MTSU’s Business and Economic Research Center. … [BERC Associate Director Steven] Livingston noted that ‘significant declines’ in Tennessee’s shipments to Canada of automobiles and of computers were the major reason for this relatively modest performance.” (Jimmy Hart, “Has the Trade War Hit Tennessee’s Shores?” MTSU Business and Economic Research Center, 10/3/18)

‘THIS COULD BE CATASTROPHIC.’  “Small businesses around the country say they are bracing for the latest round of tariffs, which could cut into already-thin profits and leave them with little recourse but to pass on additional costs to consumers beginning this holiday season. … ‘A 25 percent bump at the wholesale level could end up being a 40 or 50 percent increase by the time something gets to the sales floor,’ said Adam Rossi, owner of Adam Solar Rides … ‘The American consumer just isn’t willing to pay that much more.’ (Abha Bhattarai, “‘This Could Be Catastrophic’: Small Businesses Say New Tariffs Will Make It Even Harder to Compete,” Washington Post, 9/20/18)

TARIFFS MEAN HIGHER PRICES FOR GROCERIES, CLOTHES, FURNITURE, AND A LOT MORE. “The consensus among many American retailers and small business owners is that the tariffs themselves will hurt business — and that the pain will be passed along to American shoppers in the form of higher prices on a vast array of goods. The new tariffs affect imports ranging from canned vegetables to wood furniture, and seem to affect at least some of the products from major consumer brands like Crocs, Nike, Apple, and Procter & Gamble.” (Brad Tuttle, “All The Major Retailers That Say They’ll Have to Raise Prices Because of New Tariffs on China,” Time, 9/26/18)

PRICES WILL SPIKE AS HOLIDAY SHOPPING BEGINS. “Many American companies have already announced that tariffs could force them to raise prices, including Walmart, Gap, Coca-Cola, and General Motors. Macy’s also expects to be affected, and some Apple products are expected to get more expensive as well, although not its new smartwatch or wireless headphones. … ‘There’s no way around it: Tariffs are taxes on American consumers,’ says David French, senior vice president for government relations at the National Retail Federation. He adds that some prices might increase as soon as the holiday shopping season.” (Yoni Blumberg, “Trump’s $250 Billion in China Tariffs Are Now in Effect – Here’s What Could Get More Expensive,” CNBC, 9/25/18)

TENNESSEE MANUFACTURERS SAY TARIFFS MAKE IT IMPOSSIBLE TO COMPETE WITH FOREIGN COMPANIES. “Executives from six area companies employing more than 1,000 Tennesseans described the significant price increases on steel, both domestic and imported, that they said are impairing their ability to compete against foreign companies. According to the Aug. 13 letter, steel prices are the highest they have been since 2008 and they have increased by 43 percent since this time last year. ‘These employees and our businesses depend on access to competitively priced steel to fabricate our products and compete in a global marketplace,’ the leaders wrote. ‘We cannot compete globally when the cost of our most important input has spiked and delivery times are extended.’” (Jamie McGee, “Tennessee Manufacturers Urge Trump to Rescind Steel Tariffs,” Nashville Tennessean, 8/20/18)

TRADE WAR WILL INFLICT MAJOR DAMAGE ON AUTO MANUFACTURING. “The Trump administration’s new tariffs on aluminum and steel and the threat of more duties on imported cars and car parts will weaken the U.S. economy and inflict serious damage on the nation’s auto industry, a panel of trade analysts warned Wednesday. Americans will pay thousands of dollars more for new cars and trucks as a result of the tariffs, and as many as 700,000 workers in the auto industry could lose their jobs, the analysts told a Senate committee.” (Michael Collins, “Tariffs on Imported Cars, Parts Could Harm U.S. Economy and Auto Industry, Experts Warn,” USA Today, 9/5/18)

AUTO INDUSTRY EMPLOYS A THIRD OF TENNESSEE’S MANUFACTURING WORKERS. “In Tennessee, the number of auto jobs has nearly doubled, and exports and family incomes have increased under the North American Free Trade Agreement, which eliminated most tariffs between the United States, Mexico and Canada. A third of the state’s manufacturing workforce is now employed in the automobile industry.” (Michael Collins, “Tariffs on Imported Cars, Parts Could Harm U.S. Economy and Auto Industry, Experts Warn,” USA Today, 9/5/18)

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