Latest Tariff Wave Spreads Trade War Pain Across Indiana

QUOTE FROM TARIFFS HURT THE HEARTLAND SPOKESMAN BRIAN KUEHL: “Tariffs have already taken a heavy toll on Indiana’s economy but the pain is going to get worse. The latest wave of tariffs is a tax that will raise the prices Hoosier families pay for essential items like groceries and clothing. Hoosiers want fair trade policies, the trade war is hurting consumers, workers, and families, and businesses across the state.”

‘LIKE WATCHING A MINOR TRAFFIC ACCIDENT ESCALATE INTO A MULTI-CAR PILEUP.’ “Watching recent developments in the U.S. trade war with China has been like watching a minor traffic accident escalate into a multi-car pileup. What began earlier this year as tariffs on $50 billion worth of imported Chinese steel and aluminum has ballooned to tariffs on $200 billion worth of Chinese imports. Effective Sept. 24, the United States is levying a 10 percent tax on a dizzying array of more than 6,000 categories of Chinese goods—a tax that could rise to 25 percent. Everything from electronics and appliances to lumber, cars and building materials is about to get more expensive.” (Cecil Bohanon & Nick Curott, “We’re About to Feel Pain of Trade War with China,” Indianapolis Business Journal, 9/28/18)

  • TARIFFS ARE TAXES ON HOOSIERS. “Tariffs on Chinese imports are, in effect, just a tax on the American consumers of these products. As mentioned, this will cause prices paid by consumers to rise. More important, but less obvious, it will cause U.S. gross domestic product to fall.” (Cecil Bohanon & Nick Curott, “We’re About to Feel Pain of Trade War with China,” Indianapolis Business Journal, 9/28/18)

HOOSIERS BELIEVE TARIFFS WILL HURT THE ECONOMY. “A series of NBC News/Marist polls of six politically important states released in recent weeks highlight the potential political peril Trump faces if the trade war with China affects a larger swath of the economy. Pluralities of registered voters in Illinois, Indiana, Missouri, Pennsylvania, Tennessee and Texas believe tariffs will damage the U.S. economy.” (Trump Risks Midterm Voter Backlash for GOP If He Expands China Trade War, As Tariffs Are Unpopular in Six Key States,” CNBC, 9/7/18)

  • NOTE: “The numbers listed below show the proportion who believe tariffs will ‘protect American jobs and help the U.S. economy,’ followed by those who think they will ‘raise the costs of consumer goods and hurt the U.S. economy,’ then those who say the actions will not have much of an effect. … Indiana: 29 percent/41 percent/19 percent (-12).” (Trump Risks Midterm Voter Backlash for GOP If He Expands China Trade War, As Tariffs Are Unpopular in Six Key States,” CNBC, 9/7/18)

FARMERS STRUGGLE TO STAY ABOVE WATER AS TRADE WAR MAKES IT EVEN HARDER TO TURN A PROFIT. “[Brownsville, IN farmer Jack] Maloney said he had already cut back on expenses during the past three years and hasn’t taken a paycheck from his farm for more than a year because of tough times before the trade war began. He said the recent tumult has dashed hopes for stabilizing agricultural markets anytime soon. ‘We were seeing a little light at the end of the tunnel — the markets were improving a little,’ he said, ‘and then this tariff thing happened and this trade war.’” (Juliet Linderman, “As Trade War Aid Checks Go Out, Farmers Worry Bailout Won’t Be Enough,” Associated Press, 9/23/18)

  • USDA AID PROGRAM FALLS SHORT FOR FARMERS STRUGGLING WITH DRASTICALLY LOWER COMMODITY PRICES. “Jack Maloney says corn farmers will be getting so little in bailout aid that for roughly 200,000 bushels of corn a farmer would get only about $2,000 for their losses. ‘That’s not even beer money,’ said the Brownsburg, Indiana, corn and soybean grower.” (Juliet Linderman, “As Trade War Aid Checks Go Out, Farmers Worry Bailout Won’t Be Enough,” Associated Press, 9/23/18)

TARIFFS CUT CASH FLOW FOR HOOSIER FARMERS. “The United States Department of Agriculture projects record yields for Indiana farmers this year.  But demand has fallen, in part because of Chinese tariffs on U.S. corn and soybeans, so farms’ cash flow could be limited.” (Samantha Horton, “Projected High Yields, Tariffs Challenge Hoosier Farmers,” Indiana Public Media, 9/26/18)

  • TRADE WAR CAUSES 20 PERCENT DROP IN PRICE FOR MAJOR CASH CROP. “Soybean prices have fallen from about $10 a bushel earlier this year to around $8 today. Purdue University agricultural economist Chris Hurt says on top of the tariffs, excess product will hurt prices this year, and impact 2019 production.” (Samantha Horton, “Projected High Yields, Tariffs Challenge Hoosier Farmers,” Indiana Public Media, 9/26/18

INDIANA PRODUCTION LINES ARE CUTTING HOURS AS SALES DROP. “Eighty percent of the world’s recreational vehicles are built in and around Elkhart County, Indiana, which voted for Trump by a 2-1 margin. When times are bad, people don’t buy RVs, because they are a luxury, not a necessity. The Great Recession walloped Elkhart, which saw its unemployment rate hit 20 percent. Nine years later, the rate is 2.3 percent. But RV sales are falling and some plants have cut production to four days a week. Why? Trump has imposed new duties on steel and aluminum, two commodities needed to build motor homes, campers and the like.” (Stephen Chapman, “Casualties of Trump’s Trade War,” Chicago Tribune, 9/25/18)

GLOBAL TRADE SUPPORTS MORE THAN 812,000 INDIANA JOBS. “The chamber also reported that 812,600 Indiana jobs are supported by global trade.” (Karen Caffarini, “As Tariffs Begin, Northwest Indiana Auto Workers and Farmers Share Concerns,” Chicago Tribune, 7/10/18)

INDIANA MANUFACTURERS ARE LAYING OFF EMPLOYEES AS TARIFFS PUT ‘NAIL IN OUR COFFIN.’ “A Jeffersonville company is telling national media outlets that it’s had to lay off 75 employees since February because of tariffs. The CEO of Brinly-Hardy Co., which was founded in 1893 in Kentucky, but has been manufacturing lawncare accessories in Jeffersonville for 20 years, originally testified before the Office of the U.S. Trade Representative in July about the damages tariffs have been wreaking on her business. Jane Hardy warned that the taxes on imported goods could be the “nail in our coffin” for her company, as prices have risen by as much as 37 percent for the domestic steel that Brinly-Hardy uses.” (Danielle Grady, “This Jeffersonville Company Says Tariffs Have Caused It to Lay Off 75,” Jeffersonville News and Tribune, 8/3/18)