Would you like the federal government to implement a policy that would reduce GDP, increase unemployment, benefit almost every country in the world except for the U.S., and cost you $915 a year? If so, you’re in luck! Those are just some of the impacts of current and proposed US trade actions under Section 232 and 301 of US trade law, aka, the Trump tariffs.
A new study commissioned by Koch Industries and conducted by consulting firm ImpactECON, looked at the potential cumulative impact of tariffs. Here are some of the effects we can look forward to:
• In 2019, households suffer losses equivalent to $2,357 per household (or $915 per person) in 2017 dollars.
• Gross domestic product (GDP) would be reduced by a projected -1.78 percent in 2019 (or $365.1 billion in 2017 dollars), and GDP losses are projected to cumulate to a discounted value of $2.8 trillion between 2018 and 2030.
• All countries, except the US and China, gain from US trade actions and responses and increase GDP.
• In 2019, an estimated 2.75 million workers are likely to become unemployed if all trade actions are implemented concurrently. A high proportion of these job losses affect agricultural and low-skilled workers.
• In addition to those unemployed, 665,000 workers are expected to be displaced in 2019 and must find employment in new industries. By 2030, 1.07 million workers will be employed in a different sector because of the trade actions.
Next year the Trump tariffs are expected to cost Americans $915 each—or $2,400 per household—in the form of higher prices, lower wages and lower investment. They could also wipe out more jobs than were created in 2017 (2.1 million).
If a foreign country were to cause us such substantial economic losses we would consider it an act of war. We would never tolerate such an action, especially when it harms American’s most vulnerable, the poor and low-skilled workers. Why then are we not outraged when our own government does it?