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Making it Through the Tariff War

As we’ve all heard, President Donald Trump has hit the ground running for his second term in office. He has done more in his first two weeks in office than most presidents do in their first six months. Granted, this was his second go-around, so he knew what to expect and could plan for it better than other presidents could. Even so, the number of initiatives he has started and the number of executive orders he has signed could be called staggering.

One of Trump’s initiatives has been to impose increased trade tariffs on Canada, Mexico, and China. To anyone who knows anything about Trump’s philosophy of negotiation, this was done to put pressure on those countries, perhaps only temporarily. Within two days, he had talked with the President of Mexico, convincing him to put 10,000 Mexican soldiers on the border to combat the trafficking of drugs and illegal border crossers. For this, the Mexican president has received a 30-day stay on tariffs, while Mexico and the United States negotiate a longer-term solution.

Going back to the day that the president established those higher tariffs, my intent was to write about how to survive through the tariffs. But things are changing so quickly that the article I originally intended to write may or may not be applicable. Mexico capitulated, preventing that part from turning into a tariff war, but it doesn’t look the same for Canada or especially China.

It’s hard to say whether Trump’s tough guy negotiating tactics will work with China. Culturally, the Chinese people look at everyone else as barbarians. Their government is even worse, essentially thinking the world should bow down to them. The idea of a master race didn’t go away with the killing of Hitler; it’s still alive and well in China… at least in the Chinese government.

China has already retaliated against US imports, boosting their own import tariffs on American imported goods. These tariffs have been selective, only covering a few categories of goods. As such, they are going to have little impact on American exports to China. A bigger concern for us is the goods that they export to us.

Canadian Imports

Let’s deal with Canadian imports first, as that’s the easier one, and it looks like Mexico is going to get worked out. First, I think it’s safe to say that at least part of Trump’s motivation behind increasing tariffs from Canada is the same as that for Mexico, trying to put pressure on the Canadian government to get them to tighten up border security. While most of the illegal crossing happens at our southern border, terrorists have been known to come into our country from Canada as well.

The biggest concern with Canadian imports is petroleum. Although we are a huge petroleum producer, we import petroleum from both of our neighbors. An increase in Canadian tariffs means an increase in the cost of gasoline, even in parts of the country where Canadian petroleum is not typically refined into gasoline.

Other than petroleum products, the only other major import from Canada is automobiles. US auto manufacturers have assembly plants in Canada, as well as Japanese manufacturers. Unless there is an exception for automobiles, we can expect the cost of these vehicles, or those using components made in Canada, to rise.

Chinese Imports

We import a huge amount of manufactured goods from China. This doesn’t just include finished goods, but components for things made here at home. There is little made domestically that doesn’t have Chinese-manufactured components in it. Even simple things like Clorox bleach are made with chemicals that come from China.

Remember the shortages during COVID? While we can’t say that everything that ran out in the grocery store came from China, a lot did. Fruits and vegetables, spices, and snack foods are common imports from China. This also includes products like apple juice and vitamins, which are made from Chinese produce.

There was a temporary hold placed on all goods entering the United States from China, but that seems to have lasted only two days. Shipments of goods are coming in again, albeit with a 10% tariff attached. This extra cost will ultimately be passed on to American consumers, who bear the brunt of any increase in costs to business. The companies importing those goods can’t afford to absorb that cost without passing it on.

The big question is really just how long this is going to last. That, in turn, depends on what Trump’s goal is. Just why did he slap those increased tariffs on Chinese goods? What is he hoping to accomplish? That’s something that only his closest advisors know if he’s even shared it with them.

Trump made it clear in his first term as president that he’s big on onshoring business, specifically manufacturing, which has been offshored to China and other countries. A number of his early victories in office involved convincing American manufacturing businesses to bring manufacturing operations back home, including such major industries as automotive assembly plants.

But that doesn’t mean that companies can just pick up their Chinese operations and bring them back home to avoid trade tariffs. Major factories can cost $500 million to build and become fully operational. Many of these factories are highly specific, with the equipment in them only able to make one type of product. Retooling to make something else can easily run into tens of millions of dollars.

Granted, there are a lot of warehouse and factory buildings here in the US sitting abandoned. However, having worked in manufacturing engineering, I have a healthy respect for the cost of reactivating one of those buildings and setting up operations in it again. While that can be done and done cheaper than building a new building, the company making that investment has to take into consideration that they are investing in a building that is old and has not been properly maintained.

Beyond the challenge of building new factories, there’s also the issue of labor. While there are plenty of people out of work, most of those people probably aren’t interested in working in a factory. Times have changed and factory work isn’t considered to be the “good” job it used to be.

But even changing that perception won’t change the reality of wages. The biggest reason why we have so many US manufacturers who are having their products manufactured in the Far East, especially China, is the huge difference in wages. The average hourly rate for auto manufacturers is supposedly $15.16, considerably lower than the wage of a comparable worker in China. To make up for this, US manufacturing jobs have to be much more automated than they are in other countries.

Getting Back to Chinese Imports

Pretty much everything we use every day of our lives comes from China or contains components that come from China. American manufacturing primarily focuses on large or high-dollar goods, such as cars, robotics, and medical equipment, although some smaller items are still produced domestically. Foodstuffs are largely manufactured here as well, even though we get produce from both Mexico and China, and as I mentioned earlier, some snacks are made in China.

Fortunately, the level of tariffs that Trump has imposed isn’t really all that high (10%). By itself, that’s not going to cause any shortages. What it is likely to cause is an increase in the price of just about everything. Tariffs tend to be inflationary, which is one of the main talking points against them.

As preppers, we need to be ready to deal with those increased prices. One of the most important ways to do that is to stock up on things that you use regularly. Considering the wide range of products that come from China, a good rule of thumb is to assume a product comes from China and plan your purchases accordingly. If you want to make better decisions about that, Google “What percentage of item X is imported from China”?

Another thing to do is look for domestically produced alternatives. I mentioned earlier that a lot of apple juice and vitamins come from China. If the cost of apple juice rises, switch to orange juice, which is not imported from China. As for vitamins, eat healthier so that you don’t need to depend on dietary supplements to get the nutrition your body needs.

Of course, as always, the more we can do for ourselves the less we are impacted by what happens in the world around us. Nobody who owns an apple orchard is going to be worrying about the price of imported apple juice. They probably make their own apple cider and that is probably much better than any apple juice they can buy in the store.

There are a thousand different ways we can apply this, looking at the wide range of products that we use every day. While some may not be practical to produce ourselves, the more that we can, without it taking up all our time, the better off we’ll be.

And finally, remember that this is a temporary situation. Regardless of what Trump’s reasons are for imposing these tariffs, they will not last forever. Ultimately, the authority for imposing tariffs rests with Congress, and the China lobby will be working hard to convince members of Congress to pass a law removing the tariffs that President Trump has declared.

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Written by

Bill White is the author of Conquering the Coming Collapse, and a former Army officer, manufacturing engineer and business manager. More recently, he left the business world to work as a cross-cultural missionary on the Mexico border. Bill has been a survivalist since the 1970s, when the nation was in the latter days of the Cold War. He had determined to head into the Colorado Rockies, should Washington ever decide to push the button. While those days have passed, the knowledge Bill gained during that time hasn’t. He now works to educate others on the risks that exist in our society and how to prepare to meet them. You can send Bill a message at editor [at] survivopedia.com.

Latest comments
  • Does anyone have any recent estimates about how much Fed Dollars go to farmers to keep their land “unplanted?” In past years (and I’m 73 so I can remember decades ago) the Gov’t has paid farmers thousands of dollars per acre to not plant their land that thereby keeps prices stable. I recall one farmer telling me he got $65,000 about annually to not plant his land and had received that amount for a number of years. In the mean time their land goes up in value. Does this sound like Government waste (?) and the kind of situation that DOGE (Dept. of Government Efficiency) is investigating? I agree with Bill that on the short term future a lot of prices will likely go up; but USA is huge with lots of resources. America can become greater, especially with planting crops, but maybe if the Gov’t helps with the cost of big tractors, combines, etc. Because I am not a farmer, I cannot properly evaluate nor appreciate a farmer’s situation who has unplanted land. But I would think within a few years USA ought to be able to grow all the food we need; and have plenty to export. But what particulars would need attention, suitable to farmers, that I do not know about by my having never been a farmer. I am not trying to put farmers down. I’m just saying that maybe if USA is still paying big bucks to farmers, maybe the money they pay can offset the costs of machinery to grow twice the food we have been growing.

    • Radar,
      Regarding: “… Gov’t has paid farmers thousands of dollars per acre to not plant their land …”
      One of the best machinists I worked with was quitting to “not farm rice.” I asked if he can make more money than a machinist by farming rice. He said no. Then why are you quitting? He said he will be making more money by not farming rice. Did I hear you correctly? I thought you say NOT farm rice.. I asked if he was farming rice now. He said no he is not farming rice now. Then why quit your machinist job to not farm rice? He said he has to quit to farm rice. I said: But you aren’t going to farm rice and you already aren’t farming rice already! He said: Yes, but he is going to be paid by the government to not farm rice and they will only pay him to not farm rice if he is available to farm rice, so he has to quit his job as a machinist to be available to farm rice to get paid to not farm rice. He then added that he has been working as a machinist, saving up to buy a tractor. I asked why he needs a tractor. He said he needs the tractor to be able to farm rice. I said but you aren’t going to farm rice, right? Right! So, why the tractor? He said: The government won’t pay me to not farm rice unless I can farm rice, so I need a tractor. It is a shame that one of the best machinists no longer works to get paid to not farm rice!

  • I think Mexico played President Trump. Mexico had sent 15K of soldiers to the border for Biden after Harris had sent down to meet with them. Now they are only sending 10K to stop a possible tariff. 8 million US jobs are at risk if we get into a trade war with Mexico as its our largest trade partner. So trying to bluff them with a risk of tariffs is quite self defeating.

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