Trump tariffs: How they could affect Central Texans
AUSTIN, Texas - President Donald Trump made good on his promise to impose steep tariffs on goods imported from Canada, Mexico and China.
What we know:
The tariffs on Mexico and Canada were expected to take effect on Tuesday, Feb. 4, but for now, tariffs on Mexican and Canadian goods have been suspended for a month.
READ MORE: Trump tariffs on Mexico, Canada delayed for 30 days amid border negotiations
Mexico and Canada have both agreed to boost border security efforts, with Mexico pledging 10,000 National Guard troops to curb drug trafficking and Canada pledging additional cooperation at the northern border.
By the numbers:
Mexico is facing a 25% tariff, while Canada would be charged 25% on its imports to the United States and 10% on its energy products.
China is facing a 10% additional tariff due to its role in the making and selling of fentanyl, the Trump White House said.
Why you should care:
FOX 7 Austin spoke with a local economic expert about the potential impact tariffs could have on Central Texas.
"Those are really stunningly large numbers," said Kendall Garrison, CEO of Amplify Credit Union in Austin.
With promises of retaliation, some experts like Garrison are worried Americans could be left feeling the pain.
"No one wins in a trade war," said Garrison. "If we have a 25% tariff, goods are going to be 25% more expensive."
Garrison says prices at the pump could rise. "60% of the oil imports into the U.S. come from Canada," said Garrison.
READ MORE
- What is a tariff? Why Trump delayed them for Mexico and what it means for the US
- Trump signs tariff order; Mexico and Canada retaliate
- Trump tariffs on Mexico, Canada and China will start Saturday, WH says
You can expect higher grocery bills as well, Garrison says. He advises consumers to start budgeting for it.
"An avocado that you buy at the grocery store is not going to be 75 cents, it's going to be a dollar. That ripples throughout the entire economy: the prices you pay for food at the grocery store or at your local restaurant."
"I think Central Texas is uniquely susceptible because of our close proximity to the US-Mexico border. And we have we have lots of companies that are based here in central Texas that do business in Mexico," said Garrison. "So all of that's going to be challenging for the central Texas economy."
"I don't think it'll be temporary if we have a trade war. The pain will be long term," said Garrison.
Despite all this, Garrison says he's optimistic that we can still avoid an all-out trade war, and suspects some changes could be made to the tariffs in the weeks ahead.
What they're saying:
President Donald Trump admitted Sunday that Americans could feel "some pain" from the trade war he just started with Canada, Mexico and China, but said that could all go away if Canada becomes our "Cherished 51st state."
On Sunday, in a Truth Social post, Trump railed against Canada's trade surplus with the United States: "We don’t need anything they have. We have unlimited Energy, should make our own Cars, and have more Lumber than we can ever use."
Trump contended that without that surplus, "Canada ceases to exist as a viable Country. Harsh but true! Therefore, Canada should become our Cherished 51st State. Much lower taxes, and far better military protection for the people of Canada — AND NO TARIFFS!"
"WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT!)," Trump said in a social media post. "BUT WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID."
Dig deeper:
Trump has said he was enacting the tariffs to take greater action against illegal drugs.
He said the tariffs would lift if Canada and Mexico did more to crack down on illegal immigration and fentanyl smuggling, though there are no clear benchmarks.
Trump also said the U.S. can no longer run a trade imbalance with its two largest trade partners.
What's next:
Trump put a month-long pause on the Canada and Mexico tariffs after those countries agreed to step up border security efforts. But there are no guarantees on whether that will hold.
The Ministry of Commerce in China said it would file a lawsuit with the World Trade Organization for the "wrongful practices of the U.S." and take measures to safeguard its rights and interests.
The Source: Information in this report comes from reporting by FOX 7 Austin's John Krinjak and previous reporting by FOX.