Trump loves to brag about “ending” the fictional “War on Christmas” to the acclaim of his hooting fan base, but his escalating trade war with China could mean Americans have to spend more on Christmas presents. At least that’s what Walmart, the largest retailer in the United States, claims in a letter to the Trump administration about the trade policy.
Trump slapped tariffs on billions of dollars of Chinese goods over the summer and China retaliated with their own tariffs targeting U.S. goods like soybeans. U.S. soybean farmers are pretty pissed about the situation, saying the spat has “devastated” the industry. Now retailers are fighting back too. Walmart sent a letter to the Trump administration warning the trade war would force them to raise prices on a whole host of products.
“This round of tariffs could impact a significant number of common consumer items that are not easily replaceable,” the letter reads. “The immediate impact will be to raise prices on consumers and tax American business and manufacturers.”
In addition to food, the products Walmart says Americans will pay more for include,
“[L]uggage and handbags; bicycles and motorcycles; leather apparel, hats, hand tools and some furniture; lighting and mirrors including Christmas lights; monitors; paper tablecloths, napkins, plates and cups, toilet and tissue paper; dog leashes, home air conditioners, refrigerators, vacuum cleaners, and calculators.”
In their letter, which urged the U.S. and China to continue negotiations that have fizzled recently, Walmart details the negative effects of the tariffs on the economy.
“Walmart and our suppliers will pay the cost of increased duties, which are simply taxes levied on products at the border. As a result, either consumers will pay more, suppliers will receive less, retail margins will be lower, or consumers will buy fewer products or forego purchases altogether. Furthermore, none of these items are related to intellectual property or trade secrets and it is difficult to see how taxing these goods will resolve these more complex trade challenges.”
Trump’s Commerce Secretary, billionaire Wilbur Ross, bizarrely claimed Americans wouldn’t notice they were paying more for the products this week on CNBC.
Commerce Secretary Wilbur Ross leaves CNBC hosts dumbfounded after he tells them that American families won’t be bothered by tariffs on $200b of Chinese goods because “it’s spread over thousands and thousands of products” so “nobody will actually notice” that prices went up. pic.twitter.com/VXgCZ9EQFr
— Aaron Rupar (@atrupar) September 18, 2018
“Nobody is going to actually notice it at the end of the day,” Ross speculated, because the increased prices will be “spread across thousands and thousands of products.” But here the administration is trying to have its cake and eat it too. If the increased cost isn’t enough to incentivize U.S. products, then what’s the point?
Additionally, if the two countries fail to resolve the trade dispute, the 10 percent penalty on $200 billion of Chinese goods would rise to 25 percent on January 1st and could have far-reaching effects on the global economy. It could even have the unintended consequence of incentivizing more retailers moving to China in order to reduce the cost of production.
How do you say “Merry Christmas” in Mandarin?