Mickey Mouse
Regardless of your views on whether tariffs are good or bad (by the way, they are bad) almost everyone would agree that the level of tariffs should be signalled well in advance. Businesses need time to adjust, and if necessary change markets. Customs needs time to implement them (in NZ I believe 60 days is required for new tariffs to be implemented).
But what we have happening in the US is almost literally you wake up in the morning to discover what new or changed tariffs have been announced. This makes it near impossible for businesses to plan or have confidence. Imagine if your landlord could every few days change your rent without notice!
So here is the history of tariff announcements since 20 January.
- 1 Feb: 25% tariffs on Mexico and Canada, 10% on China
- 3 Feb: 30 day pause on Mexico and Canada tariffs
- 10 Feb: 25% tariffs on all steel and aluminum imports
- 4 March: China tariff goes up to 20%, 25% tariff on Canada and Mexico resumes
- 26 March: 25% tariff on automobiles from 3 April and automobile parts from 3 May
- 2 April: Tariffs from 10% to 49% on entire world.
- 7 April: Tariffs on China go to 104%
- 9 April: Tariffs on China go to 145%, other new tariffs set to 10% for 90 days
- 12 April: Imports from China of smartphones, laptops and semiconductors excused from 145% tariff for 90 days
The real loser in all of this will be business and consumer confidence. When major policies change every few days, it is hard to be confident about the future.
And it isn’t over. Now special pharmaceutical and semiconductor tariffs are planned, and the automobile tariff may be suspended 90 days. Just so Mickey Mouse.