Trump administration goes ahead with tariffs after month-long pause
President Donald Trump said last month that he was imposing tariffs on Canada and Mexico, our North American allies and closest neighbors, but he paused them as the countries tried to work things out.
Well, the hopes of a deal have been dashed, as Trump announced he would impose 25% tariffs on imports from Canada and Mexico, and they will go into effect on Tuesday (March 4). Trump is also tagging China for an additional 10% tariff on imports.
Trump told reporters there was “no room left for Mexico or Canada” to negotiate an alternative to the tariffs. “They’re all set. They go into effect tomorrow,” the president said at a White House event.
The administration has cited the flow of the deadly opioid fentanyl into the U.S. for the tariffs and was unaffected by Canadian and Mexican efforts to strengthen their respective borders.
Tariffs are essentially taxes on foreign goods paid by the importers. Critics warn that these tariffs will lead to higher prices for U.S. consumers, who are already struggling with inflation and high interest rates.
Canadian Prime Minister Justin Trudeau has already announced he will impose retaliatory tariffs on the U.S. in what could become an ugly trading war with consumers stuck in the middle.
China also announced retaliatory measures against the U.S. for the first round of tariffs and has vowed additional plans to address the latest round.
In an interview with CNBC, Commerce Secretary Howard Lutnick said opioids are pouring into the U.S., killing about 75,000 autopsied Americans a year. He says China makes the opioids, and then Mexico and Canada feed them into the U.S. “They’ve done a nice job on the border, but they haven’t stopped the flow of fentanyl.”
Canada has emphasized that the amount of fentanyl that travels into the U.S. from the northern border is just a small fraction of what comes in through Mexico.
Best Buy CEO Corie Barry told CNBC that prices are “highly likely” to rise after tariffs. The CEO says that trade is critically important to their industry and that their supply chain is “highly global, technical and complex.”
Barry expects his vendors to pass along some tariff costs to retailers, making price increases for American consumers “highly likely.”
Warren Buffett made a rare comment to CBS over the weekend on Trump’s tariffs, warning about their negative effects on the consumer.
“[Tariffs] are an act of war, to some degree,” Buffett shares with CBS. “Over time, they are a tax on goods. I mean, the tooth fairy doesn’t pay ’em! And then what? You always have to ask that question in economics. You always say, ‘And then what?’”
