Tariffs are a Tax on the Middle and Working Classes

Shutterstock (Evan El-Amin)

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In his feud with yet another country, Trump has jeopardized the quality of life of millions of Americans already living paycheck to paycheck. His trade war with China will not end well, and it doesn’t appear to be wrapping up anytime soon. In the meantime, the working and middle class will suffer.

For those who know little about trading and tariffs, Trump’s boisterous approach to “making America great again” makes sense on the surface. Raising tariffs, which are taxes on goods coming into a country, should bring in more money for American companies as the foreign competitor’s goods would be made too expensive. However, when other countries can do the same to Americans goods, this is not the end result. Other nations, this time China, will simply impose their own tariffs until both countries are engaging in a back-and-forth that penalizes those farthest from the decision– the citizens.

Tariffs, in short, are a tax on the middle and working class. And for those living paycheck to paycheck, it can mean the difference between putting food on the table and paying rent. When China increases the prices on raw and finished materials needed for American goods, it’s our citizens that have to pay higher prices to make up the difference. An example of this is seen with the Beer Institute, which is the trade group representing beer manufacturers. Business Insider reports that the 10% aluminum tariff “will add on an additional $347.7 million in costs for American brewers.” To keep profits steady, this means Americans will have to pay more for the same product. While beer is not a necessity, canned goods, cars, and medical devices are.

What’s really cause for alarm, however, is the reciprocal tariffs proposed by China. The country has threatened to impose tariffs on soybeans, which will be a blow to Nebraska, Indiana, Missouri, and Iowa, our country’s major producers of soy. What’s more, China is America’s largest export market for soybeans. By egging China into a trade war under the guise of enriching American industries, Trump’s administration is lessening the profits of farmers from states he won in 2016.

There is a strong argument for Congress, not the President, to be making such important decisions. After all, Congress is granted the power to regulate commerce with foreign nations in the Commerce Clause, and to “lay and collect taxes, duties, imposts and exercises” in the Taxing and Spending Clause. While Congress has given the White House greater authority over trade and tariffs over the last years, an opportunity to roll back some of that power can be seized when reauthorization for such practices is needed. A consensus must be reached on bipartisan grounds for the sake of the average American, who will undoubtedly see price increases from this trade war. If Congress can do this, they will empower their branch of government, as well as help American consumers and workers.

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