More than a few times, I have been told that one of the reasons Trump supporters continue to be his supporters is jobs. When asked in a recent poll what the single most important issue was to most people, the answer was ‘jobs’. Granted the job outlook has, until recently, looked pretty good, but not as a result of anything Trump has done. Unemployment was already low and dropping at a steady rate under President Obama. And now, with his tariffs and the retaliatory tariffs from other nations, that may well be about to change. Actually, the pendulum is already beginning to swing back. Consider this …
The following is an excerpt from a story in today’s Washington Post:
POPLAR BLUFF, Mo. — When a Mexican company bought Mid Continent Nail Corp. in 2012, workers at the factory here feared it was the beginning of the end. Their jobs, they suspected, would be given to lower-paid workers in Mexico, more casualties of the hollowing out of U.S. manufacturing driven in part by an embrace of global trade.
Instead, Mid Continent’s factory has doubled in size since Deacero’s purchase. The company, facing fewer restrictions on steel exports after the North American Free Trade Agreement, shipped steel into Missouri, willing to pay skilled workers more to take advantage of cheaper energy costs in the United States and a location that allowed swift delivery to U.S. customers.
But … Trump has put 25 percent tariffs on steel imports, bumping production costs and prompting Deacero to reconsider this arrangement. With Mid Continent charging more for nails, orders are down 70 percent from this time a year ago despite a booming construction industry. Company officials say that without relief, the Missouri plant could be out of business by Labor Day — or that remaining production could move to Mexico or another country.
The layoffs have already begun. The company now employs fewer than 400 workers, down from about 500 before the tariffs took effect last month.
The plant may close its doors by Labour Day. That, folks, is just a month-and-a-half away! We’re not talking about next year, or in three years … we’re talking about NOW.
Or consider the case of Harley-Davidson, who will begin shifting production for the EU market to its international facilities rather than raise their prices by as much as 31% if they stayed in the U.S. Typically, when their decision was announced, rather than talk or negotiate, Trump did the only thing he knows how to do: mock and threaten. Such helpful, professional behaviour, eh?
Two weeks ago, the CEO of General Motors warned that the company may be forced to cut back production and cut U.S. jobs. And the Alliance of Automobile Manufacturers (AAM), issued an analysis estimating the price of a typical new vehicle sold in the U.S. would rise by about $5,800 as a result of the tariffs. Think about that one … nearly $6,000 more to buy a car!
An analysis by Trade Partnerships concludes that …
- The tariffs, quotas and retaliation would increase the annual level of U.S. steel employment and non-ferrous metals (primarily aluminum) employment by 26,280 jobs over the first one-three years, but reduce net employment by 432,747 jobs throughout the rest of the economy, for a total net loss of 400,445 jobs;
- Sixteen jobs would be lost for every steel/aluminum job gained;
- More than two thirds of the lost jobs would affect workers in production and low-skill jobs.
- Every state will experience a net loss of jobs.
These are but a few examples of the fallout from Trump’s trade tariffs, and the damage is only beginning. The longer the tariffs remain in effect, the more jobs will be lost AND the more we will see the prices of both agricultural and durable goods rise. While I do not wish the loss of a job on anyone, I have to ask: is this what it takes to awaken Trump followers? Do they have to lose their jobs before they begin to see that virtually nothing Trump has done has been in our best interest? Will they finally get it when they awaken one morning and realize they have no job, no health insurance and cannot afford food for the next week, let alone a car to go buy that food or look for another job?
Trump’s cabinet were handpicked for their loyalty to Trump, and they received early training in “alternative facts” and “how to spin anything using blatant lies”. Treasury Secretary Steven Mnuchin learned his lessons well, apparently, for he claims U.S. tariffs and China’s retaliatory actions haven’t dented the domestic economy, as he sought to calm fears from Republicans in Congress that a trade war is hurting American consumers and companies.
Paul Ryan, on the other hand, seems to have remembered his Econ 101:
“We risk having American products locked out of new markets, jobs moved overseas, and a decline in American influence. As our generals will tell you, these agreements are just as important for our national security as they are for our economy.”
It is time for Trump’s followers to wake up and realize that they are the ones who will be hurt most by his policies regarding education, the environment, foreign policy, and the economy. A number of issues have been forgotten in recent days as we are all concerned with Trump’s horrific behaviour abroad last week, and his apparently slavish adoration of Vladimir Putin, as evidenced in Helsinki on Monday. Trump has been in a whirlwind of tweets and speeches contradicting his own self at every turn, in a foolish attempt to put some favourable spin on his actions, else distract us from them. But we cannot afford to take our eyes off any of the balls: the immigrant children, abuses of power, tariffs, and much more.