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    Breaking News

    Trade War Losers

    Aluminum sheet, pesticides among industries adversely affected.

    Trade War Losers
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    Happi Staff12.28.19
    The results are in and several industries have fared worse than others in the ongoing US-China trade wars, according to a new study by the Federal Reserve, which concluded that President Donald Trump’s strategy to use import tariffs to protect and boost US manufacturers backfired and led to job losses and higher prices.
     
    “We find that the 2018 tariffs are associated with relative reductions in manufacturing employment and relative increases in producer prices,” concluded Fed Economists Aaron Flaaen and Justin Pierce, in an academic paper.

    The top 10 manufacturing industries hit by foreign retaliatory tariffs were producers of magnetic and optical media, leather goods, aluminum sheet, iron and steel, motor vehicles, household appliances, sawmills, audio and video equipment, pesticide and computer equipment.
     
    The Household and Commercial Products Association, whose members include aerosol can manufacturers which rely on aluminum sheet, has been one of the most vociferous opponents of the tariffs. In May, HCPA issued the following statement:
     
    “By increasing the costs to these essential, everyday products and inviting retaliatory tariffs on the finished products that American industry ships abroad, the Administration is effectively placing a tax on consumer products that will ultimately be paid by Americans and cost jobs. HCPA condemns these increased tariffs, which will most assuredly escalate the trade feud with China, and respectfully urges the Administration to continue to engage productively in bilateral negotiations to bring stability back to the American economy.”
     
    The Fed agrees.   
     
     “While the longer-term effects of the tariffs may differ from those that we estimate here, the results indicate that the tariffs, thus far, have not led to increased activity in the US manufacturing sector,” the study said.
     
    A recent truce in the trade war is welcome news for many industries. But with a new year approaching, business executives and others wonder if the “phase one” deal is merely a cease-fire or the start of a lasting peace.
     
     
     
     
     
     
     
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