Tariffs on steel and aluminum imports are set to climb on Wednesday to a staggering 50%, after President Donald Trump announced this past Friday that he was doubling the import duty on the essential material used to make homes, vehicles, groceries, and numerous other items.
Trump claimed that raising the tariffs on those essential materials will “secure the steel industry in the U.S.”
However, the absurdly high tariff is also expected to cause inflation to spike on everything from soda, canned goods, car prices, and even the housing market.
“Rising grocery prices would be part of the ripple effects,” Usha Haley, a professor at Wichita State University who is an expert on trade policy, told ABC News.
The tariffs will also make it more expensive for developers to build housing, which could cause already high housing prices to rise even further.
“[N]umerous raw materials and components, ranging from steel and aluminum to home appliances, are sourced from nations across the globe that are subject to Trump’s latest tariffs. These tariffs are projected to raise the cost of imported construction materials by billions of dollars, depending on the specific rates,” the National Association of Home Builders, a powerful trade association, said in a statement. “For some materials, where imports are critical to supply, prices could see dramatic increases, adding layered costs that could substantially impact builders’ ability to deliver new projects.”
President Donald Trump walks with workers as he tours U.S. Steel Mon Valley Works-Irvin Plant on May 30 in West Mifflin, Pennsylvania.
Trump already raised tariffs on these imports to 25%, which is already too high. But if the tariffs spike to 50%, it would bring more pain to American consumers and businesses.
In fact, the European Union said that if Trump allows the new 50% tariff to take effect, they will be forced to “impose countermeasures,” which could further hurt the U.S. economy.
“The European Commission is currently finalizing consultations on expanded countermeasures,” an E.U. spokesperson told CNBC. “If no mutually acceptable solution is reached, both existing and additional EU measures will automatically take effect on 14 July—or earlier, if circumstances require.”
Of course, that will happen only if Trump doesn’t cave and lets the tariffs go into place.
And it’s a decent bet that Trump will cave since he has reneged on his nonsensical and haphazard tariff announcements so many times that traders on Wall Street gave it the derogatory nickname “TACO,” which stands for "Trump Always Chickens Out."
Trump is irate about the slight, CNN reported. He’s so angry, in fact, that we wonder if he won't cave on his latest tariff spike because he's so worried about looking like a wimp.
“It clearly bothered him, primarily because it demonstrated a lack of understanding about how he actually utilizes those threats for leverage,” an unnamed source told CNN. “But obviously he’s not a guy who looks kindly on weakness, so the idea anyone would think that with respect to his actions isn’t received well.”
We have until Wednesday to see if Trump chickens out yet again.
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