President Donald Trump said Sunday that Americans could feel “some pain” from the emerging trade war triggered by his tariffs against Canada, Mexico, and China, according to the Associated Press. The trade penalties that Trump signed Saturday threaten to rupture a decades-old partnership on trade in North America while further straining relations with China.
The tariffs are set to launch Tuesday. Trump is placing a 25% tariff on Canadian goods, with a 10% tax on oil, natural gas, and electricity. One-quarter of the oil that America consumes per day is from its ally to the north. In retaliation, Canada is imposing 25% tariffs on U.S. products, first targeting alcohol, cosmetics, and paper products. A later round will include passenger vehicles, trucks, steel and aluminum products, certain fruits and vegetables, beef, pork, dairy products, and more.
Canada is the largest export market for 36 states, and Mexico is the largest trading partner of the U.S. Mexico’s president, Claudia Sheinbaum, also announced new tariffs, and the Chinese government said it would take steps to defend its economic interests. It intends to file a lawsuit with the World Trade Organization.
Outside analyses make clear that Trump’s tariffs would hurt the voters that he intended to help, meaning that he might ultimately need to find a resolution.
An analysis by the Budget Lab at Yale shows that if the tariffs were to continue, an average U.S. household would lose roughly $1,245 in income this year, in what would be the overall equivalent of a more than $1.4 trillion tax increase over the next 10 years.
