The Cost of Protectionism

In the heart of Denver, Sandra Payne, the brain behind Denver Concrete Vibrator, is worried. Her business depends on steel and other raw materials from China, Canada, and Mexico. But now, President Trump's new tariffs are making her life harder. Her company makes tools for concrete and other industries, and with a 25% increase in steel prices, things are getting tight. Sandrawas blunt, "We can't just jack up our prices every time the cost goes up, so we are losing a lot of money. Small businesses have tiny profit margins, so a price hike means we have to cut costs elsewhere. Sandrais feeling the heat, but to make things more interesting consider this: Canada, the U. S. , and Mexico are partners. They have a trade agreement. Now, the U. S. is putting tariffs on imports from Canada! Sandra's concern is that tariffs on Mexican and Canadian goods are temporarily on hold but could restart, and small businesses need to plan for this. The tariffs aren't just about steel. Although there are vast amounts of steel, there are other resources which can have a domino effect.

Think about this: because the U. S. and Canada are close allies and trading partners, this should have been avoided. The tariffs might force businesses like Sandra's to raise prices or even cut back on products. Across the border, Julie Bednarski-Malik, the brains behind Healthy Crunch, a snack company in Mississauga, Ontario, is also feeling the heat. Her products are sold in both Canadian and U. S. retail stores. She's waiting to see how the tariffs will unfold before deciding if she needs to raise prices. She’s in wait-and-see mode as tariffs loom. Her company is waiting to see how the tariffs will unfold before deciding if she needs to raise prices. She doesn't know what products will be hit or by how much so she's waiting to see how the tariffs will unfold before making any moves. In San Diego, Barack Zakheim's company is not happy. He owns Better Place Design & Build, a contracting company who specializes in building ADUs which are accessible dwelling units. He said he is especially worried about lumber. "Lumber has already been getting more expensive over the past few years due to supply chain shocks and wildfires. And here’s the rub: a huge proportion of their lumber comes from Canada. These tariffs are going to make everything they do even more expensive. The high-priced housing market and high interest rates are already cutting into their bottom line. As Sandra and Julie know, the tariffs will likely have a domino effect. I sell to other businesses, I don’t sell to the end user. So everything that happens to me is going to happen all the way down the line. It’s going to impact everyone down the line. " This is not just about a few companies or a few products. This is about how the U. S. makes trade agreements. It's about how we support our small businesses. It's about how we work with our allies.

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