You Reap What You Sow

Monday, June 25, 2018

“Trade wars are good, and easy to win.” - Donald J. Trump (March 2, 2018)

The United States has imposed tariffs on its economic allies. Canada, Mexico, and the European Union all became subject to trade penalties of 25 percent on steel, and 10 percent on aluminum starting June 1. This was done at the behest of President Trump. Our allies have retaliated. The EU has begun applying a 25 percent tariff to a variety of our goods we make and manufacture here in the United States. These new tariffs will affect more than $3.4 billion worth of our exports. 

Look at what our state’s Republican Senators had to say: 

"These [tariffs] are a big mistake, and Tennessee is likely to be the state most hurt by them because we have nearly a thousand auto parts makers in the state who use steel and aluminum. … All across the board, it’s a bad idea. … Unfortunately, our president used a national security provision in the law to justify tariffs on Europe, Canada and Mexico. We’re not likely to be invaded by Mexico and Canada. That’s not an appropriate use of the law." – Sen. Lamar Alexander

"Imposing steel and aluminum tariffs on our most important trading partners is the wrong approach and represents an abuse of authority intended only for national security purposes." – Sen. Bob Corker

Harley Davidson announced today that these economic actions will cost the company an estimated $95 million annually, and increase the price of their motorcycles sold in Europe by an average of $2,200. As of my writing this, Harley Davidson stock is down 2.8 percent in premarket trading. The company says that they will shift production overseas to avoid the added costs. Americans will lose jobs.

Tennessee usually exports about $1.5 billion worth of whiskey and agriculture annually. In 2015 Tennessee made whiskey accounted for 65 percent of all exported American whiskey. Jack Daniel’s spokesman Phil Lynch said, "We're hoping saner heads might prevail and stop the trade war before we start shipping products." Right now European tariffs are targeting our whiskey and peanuts, while Chinese tariffs are targeting our whiskey and soybeans. Tennessee farms will suffer. Tennesseans will lose jobs.

A reckoning is unavoidable. I hope everyone will remember the actions taken today when we’re suffering the consequences tomorrow. Nobody gets to act surprised.

Nolan Crenshaw




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