In Our View: Prospect of tariffs looms over state’s economy

President Donald Trump’s tariffs on goods from China, Mexico and Canada come as no surprise.

The taxes were an oft-stated campaign promise, and we look forward to him lowering egg prices, reducing auto insurance rates by 50 percent and quickly ending the Russia-Ukraine war. Meanwhile, we’re still waiting for Mexico to pay for a border wall.

Those also have been campaign promises from Trump, and while they would be important, they do not carry the same weight in Washington as tariffs against our state’s primary trading partners.

On Saturday, Trump signed orders imposing 25 percent tariffs on imports from Mexico and Canada, along with 10 percent tariffs on goods from China. By Monday, he had placed a 30-day pause on the tariffs against Mexico and Canada, another demonstration that his frequent bluster is not well-considered.

Still, the prospect of tariffs looms over the nation’s economy, particularly in our state.

As Lori Otto Punke, president of the Washington Council on International Trade, has said: “Canada, Mexico, and China are the Northwest’s top trading partners, and 40 percent of the jobs in Washington state are tied to trade. Tariffs will decrease Washington state’s robust exporting economy and raise prices at the grocery store.”

Trump views tariffs as a stick for bludgeoning other nations into agreeing with his policies, and the approach appeared to be successful in a standoff with Colombia. That South American nation agreed to accept deportation flights from the United States after Trump announced tariffs on Colombian goods.

But tariffs should be used as a scalpel rather than a sword, and targeting the United States’ three largest trading partners can have deleterious results.

In announcing the penalties against Mexico and Canada, Trump cited “the major threat of illegal aliens and deadly drugs killing our citizens, including fentanyl. We need to protect Americans, and it is my duty as President to ensure the safety of all.” But, as a statement from the U.S. Chamber of Commerce argued, tariffs “won’t solve these problems, and will only raise prices for American families and upend supply chains.”

Rather than raising prices on foreign exporters, the cost of tariffs is paid by U.S. importers and then passed along to consumers. In the case of China, that will especially impact prices on electronics, digital devices and footwear. In the case of Mexico, the United States imported $87 billion worth of motor vehicles and $64 billion worth of vehicle parts in the first 11 months of last year, according to the Department of Commerce.

Meanwhile, trading partners are certain to respond with retaliatory tariffs. According to the Washington State Department of Agriculture, our state exported $687 million worth of food and agriculture products to Mexico in 2023. That included $199 million worth of apples, making our southern neighbor the No. 1 foreign market for Washington’s leading agriculture product.

Retaliatory tariffs would increase the cost of U.S. products for consumers in Canada and Mexico, leading those nations to pursue alternative trading partners and harming Washington growers. In the process, tariffs would further open markets to goods from China, belying Trump’s stated goal of diminishing Chinese influence in the global economy.

Trump’s forceful efforts to reverse illegal immigration and secure our borders are most welcome. But using tariffs to achieve such goals would be damaging to the American economy.