Trumps Attempt at 30% Tariff on Mexico and E.U, What Happened, and What Could This Mean for The Future of the U.S and Its Relations?

Trump attempted to drop a 30% tariff on Mexico and the E.U., and no, that’s not pocket change. So what now? Let’s get into it.

What are these countries already importing for us, what is happening with the tariffs?

  Mexico imports tons of goods for automobiles and electronics. The E.U imports a lot of luxury goods and many automobiles. A 30% tariff is not small at all, it's like your cousin took one third of your birthday cake and just left you without any benefit, it hurts many people and humiliates the U.S. government. Thankfully, this didn’t happen, not in the way you might think. Keep reading and find out! But first, let's talk about the effects tariffs like these could cause.

What the Increase in Tariffs do to Prices of Goods, Jobs, and People’s Income

This can cause inflation, so a car that was 20,000 now might cost 26,000 now because these tariffs are paid by importers, not the government. Importing companies take the hit, which could mean smaller profits, fewer jobs (as more money will be preferred for the highest class), or higher prices to stay afloat.

How Will These Countries Respond to These Tariffs?

Mexico and the E.U have not been relaxed due to problems like this in the past, it can possibly lead to a trade war between them and the U.S. Export markets for the U.S can get closed off by Mexico and the E.U causing citizens to lose access to monetary gains.

Harm in the U.S.A Relations and Economy

These tariffs can shatter relations between these countries, especially with the E.U. This is due to the fact that this can undermine the relation and trust of the U.S allies within groups like the NATO and the WTO. Tariffs are not revenue tools they are supposed to be used to leverage the economy of the U.S, but the way Trump did it will worsen it rather than benefit it because of the fact that less will foreign goods will most likely be imported or exported to Mexico and the E.U due to increased prices and taxes. A lot of countries can see this and may assume irresponsibility in the U.S. or Trump specifically

So, What Really happened?

The attempt at 30% tariffs towards these countries had actually been modified to only 15%. This is still really high and can still destabilize the economy. Let's look back at our car example, a $20,000 car may not now be 26,000, but 23,000 which is still a lot more. A lot of U.S. importers from these countries whether individual or by company have either received a lot less income, or modified prices of goods to meet their needs or have severely lost a lot of money. Many German automobile companies like BMW have faced millions of dollars in losses and financial burdens.

Conclusion

This situation can lead to a significant loss of monetization opportunities for lots of  individuals and businesses within the E.U. or Mexico, particularly those who rely on international trade or digital platforms for income (e.g BMW). In addition to the financial strain on individuals, it may also weaken or strain diplomatic and economic alliances between nations, as trust and cooperation may deteriorate in response to these challenges.

Furthermore, the disruption of global supply chains could result in a noticeable decrease in the availability and diversity of consumer products on the international market, ultimately reducing choices for consumers and increasing prices. These combined effects could negatively impact the broader economy of the United States, potentially leading to slower economic growth, reduced investor confidence, and increased economic instability in certain sectors.