Trump's Tariffs Are Going To Make Your Food More Expensive
Food prices are rising, and they're likely to soar even more
Food prices are rising. And they're soon likely to soar even more.
The coming spike, which will hurt millions of Americans, didn't have to be. It's due on the one hand to the Trump administration's plans to impose mind-numbingly stupid tariffs on China and other U.S. trade partners and, on the other hand, by retaliatory tariffs imposed by China and others in return.
American food producers, many of which aren't doing particularly well to begin with, are sounding the alarm over the tariffs.
For example, retaliatory tariffs imposed by Canada on U.S. foods and other goods are expected to hurt beleaguered American orange-juice producers and the soup maker Campbell's, which is already struggling with falling sales. In addition to orange juice and soup, the Canadian tariffs single out U.S. chocolate, ketchup, yogurt, beef, coffee, maple syrup, and salad dressings.
Quartz published a list this week of the more than 6,000 Chinese products the Trump administration has slapped with tariffs. I read through the list, which begins with frozen cuts of meat of swine and ends with acetic acid esters. My scrolling fingers cramped well before I could identify anything on the list that isn't a food or agricultural product.
In response, China has targeted "American farm products" with its own retaliatory tariffs. The European Union has also imposed duties on U.S. peanut butter imports, part of a $3.4 billion set of retaliatory tariffs.
The impact of these tariffs on food producers is already being felt. One Seattle distillery that planned to expand its workforce and export its spirits scrapped those plans completely due to the tariffs. North Dakota soybean growers have seen China—the biggest buyer of U.S. soybeans—cancel orders.
Worries over the growing trade war are also evident abroad. In Canada, for example, food retailer Empire is warning it may have to pass tariff-related price increases on to consumers.
Tariffs have a lengthy—if not proud—history. Sugar tariffs are probably the most venerable example in this country of the general suckiness of such policies. In fact, they're as old as this country. One of the first substantive laws Congress passed, in 1789, included sugar-import tariffs. That may or may not have been a good idea at the time. America had just been won a costly war for independence that, I've argued many times, was predicated in large part on battles over food taxation and food restrictions imposed on the colonies by Great Britain.
More recently, Pres. Ronald Reagan held his nose and accepted sugar tariffs as part of a budget deal, leading the N.Y. Times to dub Reagan's capitulation "a self-fired shot in the foot that seems sure to affect not only American consumers and American sugar growers, but foreign producers as well."
I'm firmly of the belief that all tariffs suck. And rising prices only tells part of the story of why that's the case. They cost jobs; hurt domestic and foreign producers, consumers, and taxpayers; put the petty interests of government over those of the public; and are prone to spinning out of control. To paraphrase Nobel Prize-winning economist Milton Friedman, tariffs are bananas.
Tariffs tend to make almost no one better off and—thanks to the ability of other countries to retaliate—make most everyone worse off. They hurt those who engage in commerce—producers, employers, sellers, consumers, and taxpayers alike—at home and abroad.
Where will these tariffs end? Maybe at the ballot box come fall. One Tennessee farmer who generally votes for GOP candidates says he'll cast his vote this November for a Democrat, since "Trump's trade wars are hurting his family business—a sizable one with some 400 employees and 30,000 pigs."
