🔱President Donald Trump announced that tariffs on Mexico and Canada will begin on March 4. He also threatened an additional 10 percent tariff on China’s imports.

At a time when consumer confidence is dropping, Trump still believes that slapping high tariff rates on allies and key trading partners will somehow improve the U.S. economy. In our previous newsletters, we’ve demonstrated that Trump’s protectionism harms people—the everyday consumer—much more than foreign companies and foreign governments.

• Trump has remained inconsistent regarding his policies on tariffs for the United States’ two most important global trading partners: both Mexico and Canada.

• Trump’s inconsistent behavior results from his belief that he can bully other countries and large multinational companies into complying with his demands.

• For example, Trump relies on the talking point that he is basing tariffs on efforts to prevent the influx of unlawful fentanyl. Trump said the same thing about Mexico.

• A White House official told Reuters on Feb. 27, “There are ongoing discussions with the Chinese, Mexico, and Canada. We’ve gotten a good handle on the migration issue, but there are still concerns on the other issue of fentanyl deaths.”

• What this means is that direct negotiation exposes Trump’s intent to get individual trade deals with countries despite the short- and long-term economic harm this approach could have on the American people. And that harm will hit prices.

• Mike Williams, a senior fellow at the left-wing Center for American Progress, wrote for The Guardian that Trump’s approach to trade will most likely backfire. Williams wrote, “Trump has claimed his tariffs will create a ‘manufacturing boom,’ turn America into a manufacturing ‘powerhouse’ and ‘make America rich again.’ But going all in on tariffs alone is an unsteady foundation for industrial policy.”

• In 2020, Federal Reserve Board researchers published their findings in the peer-reviewed Journal of Monetary Economics. They concluded that “[news] and increased uncertainty about higher future tariffs reduce investment and activity.”

Bottom line: One key point from this spiel is that Trump will continue to increase tariffs in a way that is inconsistent with the American economy

Shipping, global trade, industrials, and many other sectors will see higher prices, which will then be passed to consumers at the point of sale.

While tariffs are useful in that they generate border tax revenue, Trump’s use of them could potentially harm U.S. consumers.

MORE: “U.S. Imports from China Have Fallen by Less Than U.S. Data Indicate” - New York Fed

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📰OTHER NEWS IN FREIGHT📰

🚫Consumer confidence in the US drops to over three-year low: According to the Conference Board’s Consumer Confidence Index, consumer confidence has dropped by seven points. Stephanie Guichard, senior economist for the Global Indicators at the board, said, “Views of current labor market conditions weakened. Consumers became pessimistic about future business conditions and less optimistic about future income.”

Reuters reports that Christopher Rupkey, a chief economist at Fwd: Bonds, said that “no Federal government has ever before threatened government workers with mass firings, and it is starting to scare the daylights out of consumers.” Guichard added, “There was a sharp increase in the mentions of trade and tariffs, back to a level unseen since 2019.”

👍🏼ILA overwhelmingly ratifies the USMX master contract: The membership of the International Longshoremen Association (ILA) voted in a majority of its 45,000 members ratified a new contract that was tentatively agreed to in January 2025. This new master contract between the ILA Union and USMX will last from Oct. 1, 2024, to Sept. 30, 2030.

Information on the strike is available at the Journal of Commerce…

ILA President Harold Daggett praised the membership of the union. He said, “It was a tough contract to negotiate and even took a three-day coast-wide strike in [Oct.] 2024.”

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