Hardly a day goes by without something new happening that threatens trade, and of late that something has been new tariffs from the US, and new tariffs from China, Mexico and the EU in their battle to fight back.
The retail industry—as with many other sectors—has suffered the ongoing blows, wondering what’s coming next and what to do about it all. But they aren’t sitting quietly on the sidelines of the tumult in trade.
Speaking out about tariffs on Tuesday, Target CEO Brian Cornell said the U.S. retail industry will fight back against the negative impacts of President Trump’s tariffs. And they want consumers on board in the fight.
“We’re trying to make sure people understand the implications [of tariffs] as we did with the border-adjustment tax,” Cornell told the Star Tribune ahead of a Capitol Hill reception hosted by the Economic Club of Minnesota.
What retailers hope to make clear to the general consumer, is that they can expect prices to increase at some of the places they shop, as retailers, like Target, that import much of their inventory from China will be paying higher prices to bring those products in with new tariffs attached to them.
For now, Trump’s first $50 billion in tariffs on China could add a 25 percent tariff to a handful of machinery used for apparel and footwear manufacturing, though there’s no direct target on apparel or footwear finished goods. The newly proposed additional $200 billion in tariffs on China, which came down from the president Monday night, however, could still include apparel and footwear products, though there’s been no mention yet of the potential product targets for the tariffs.
Because Trump’s moves have now placed the United States squarely at the center of a full-blown trade war, retailers are looking to Congress to intervene and staunch what could end up being substantial bleeding.
On Monday, the National Retail Federation issued a statement in response to Trump’s statement on the $200 billion in potential new tariffs, saying that the first set of $50 billion in tariffs alone could reduce U.S. GDP by nearly $3 billion and cost the country 134,000 jobs. Imposing an additional $100 billion in tariffs could be a $49 billion hit to GDP and lead to the loss of 455,000 jobs—and the president has asked for double that.
“This is just what we predicted—a tit-for-tat trade war has erupted and American families are caught in the middle. Higher prices for everyday essentials and lost jobs threaten to sap the energy out of the strong U.S. economy just as most Americans are starting to enjoy the benefits of historic tax reform,” NRF president and CEO Matthew Shay said. “This reckless escalation is the latest reminder that Congress must step in and exert its authority on trade policy.”