Essay Sample on Trump's Tariff: Impact on US Economy

Introduction

A tariff is an economic term used to describe the action taken by a country to reduce or discourage the importation of certain products. The tax can affect the country both positively and negatively. President Trump imposed such tax on the importation of aluminium and steel, which have affected the American economy.

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Trump argues that the import of aluminium and steel is a threat to the national security of the country. In his statement, president trump contends that the large quantity of steel mill articles imported in the United States is harmful to the aluminium and steel local manufactures (Daugirdas and Mortenson, 2018).

The American aluminium and steel producers will benefit from the tariff while the importers will make a loss. According to York and Pomerleau (2018), the toll makes the American industries to monopolize in the aluminium and steel trade in America. As a result, companies will realize a profit. On the other hand, the tariff discourages the American importers by making it expensive for them to import their products

The tax will decrease the production of steel and aluminium hence increasing the selling price of aluminium and steel commodities. As the number of industries specializing in aluminium decreases, there will be a shortage of aluminium products in the market hence increasing the price of the products.

The tariffs cause harm to various American industries. York and Pomerleau (2018) comment that imported aluminium account for around 90% of the aluminium used in the United States. The country cannot manufacture all the aluminium needed in the industries. Therefore, the tariff will create a shortage of aluminium, which will significantly affect industries.

The tariff will create an economic crisis for the American people. Americans who work in imported aluminium industries will lose their jobs. Also, the cost of aluminium products will be expensive. The export will decline as countries like Mexico, Canada and the European Union threatens to sanction American's exports.

The implementation of the tariff was a good idea though directed to the wrong groups. The tax will harm the excellent relationship that exists between America and its neighbours. It was a wrong idea to include European Union Canada and Mexico in the tariff.

Conclusion

In conclusion, Trump argues that the tariff will reduce the national security threat. Though it will benefit various industries, it will affect those that depend on imported aluminium. Major global traders like the European Union have threatened to impose a tariff on American products.

References

Daugirdas, K., & Mortenson, J. D. (2018). Trump administration continues to push to reshape American trade relations by imposing tariffs on steel and aluminium imports. American Journal of International Law, 112(2), 315-322.

York, E., & Pomerleau, K. (2018). Tracking the Economic Impacts of US Tariffs and Retaliatory Actions. Washington, DC: Tax Foundation. June 22.