President-elect Donald Trump said he cannot guarantee that his tariff plans will not raise prices for U.S. consumers.
In an interview with Kristen Welker of “Meet the Press,” Trump dismissed warnings from economists that tariffs on Canada, Mexico, China and others would raise prices for American consumers.
Welker asked Trump if he could guarantee American families wouldn’t face higher costs.
“I can’t guarantee anything,” Trump said. “I can’t guarantee tomorrow. But I can say that if you look at my – just pre-COVID, we had the greatest economy in the history of our country.”
Tariffs could raise prices for U.S. consumers and slow economic growth. S&P Global, a credit-rating agency, reported that Trump’s proposed tariffs – a 10% across the board hike and up to 60% for China – could boost inflation by 1.8% and lower U.S. economic output by 1%, according to a post-election report.
Since that report, Trump has proposed additional tariffs on America’s biggest trade partners, including a 25% tariff on imported goods from Mexico and Canada. Mexican and Canadian officials have been cool to the proposals.
Last month, Trump said he plans to impose the tariffs on his first day in office and keep them in place until problems at the northern and southern border are fixed.
“As everyone is aware, thousands of people are pouring through Mexico and Canada, bringing Crime and Drugs at levels never seen before,” Trump announced on Truth Social. “On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders. This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”
Trump said Mexico and Canada “have the absolute right and power to easily solve this long simmering problem. We hereby demand that they use this power, and until such time that they do, it is time for them to pay a very big price!”
Trump accused China of failing to prevent smuggling of the chemicals used to make fentanyl, a powerful synthetic opioid that has fueled overdose deaths in the U.S. He singled China out for a 10% tariff. Trump previously suggested tariffs of up to 60% on Chinese imports.
Two reports from credit-rating agencies noted that Trump’s campaign promises on tariffs might not happen or might prove to be starting points for new trade agreements with other countries.
“Tariffs of this magnitude are likely political bluster or possibly a negotiating stance with U.S. trading partners,” according to the Moody’s report.
S&P said: “Campaign rhetoric doesn’t always translate into policy.”
That said, Moody’s suggested tariffs could double from about 3% to about 6%. That’s up from about 1% before Trump raised tariffs during his first term.
“U.S. consumers will bear the bulk of the cost of higher tariffs via higher prices for imported goods,” according to the report. “… A lesson from the tariffs imposed during Trump’s first term is that they will be messy to implement as exceptions are made for certain products and countries over certain periods of time due to national security or other business reasons.”
