Import tariffs trickle down locally

By Shelby Stewart
Staff Writer
Ortonville-In 2018, the Trump Administration placed tariffs, or taxes, on goods imported into the US from a number of countries, and the effects of that are now being felt, even locally.
At the Monday night meeting of the Ortonville Village Council, the village clerk, Liz Edwards, informed the council of the small surcharges she has seen on some supplies.
“This was just an FYI only for council to let you know that the import tariffs that the government placed on other countries does have a trickle down effect,” she said. “We have noticed some of the items we order, specifically if they’re plastics, we get an import or a surcharge, and it’s due to the tariffs.”

While the cost to the village has been small, similar instances have been observed nation-wide.
In a paper recently published for the National Bureau of Economic Research, Mary Amiti, microeconimic studies function of the Federal Reserve Bank of New York, Stephen J. Redding, department of economics and the Woodrow Wilson School of Princeton University, and David Weinstein, department of economics at Columbia University, took a look at who is really paying for the tariffs placed on goods coming into the US in their paper titled “Who’s Paying for the US Tariffs? A Longer-Term Perspective.”
“Using data from 2018, a number of studies have found that recent U.S tariffs have been passed on entirely to U.S. importers and consumers,” the paper reads. “These results are surprising given that trade theory has long stressed that tariffs applied by a large country should drive down foreign prices.”
The tariffs were implemented in 2018, and according to the paper, the average duty on imports went from 1.6 percent to 5.4 percent, which came from a 10 to 25 percent tariff on the $362 billion worth of imports from China. The intent of the tariffs was to drive US businesses to use US-made goods, which was brought up as a suggestion at the meeting as well.
Though, the paper found that the cost of imported goods has not lowered enough to be a result of the tariffs, and suppliers are paying the tariffs and either raising the cost of goods or using a surcharge on imported product.
“It’s the supplier trickling their cost down to us,” said Edwards. “So, to date, it’s been less than $50. The one thing that is hard for me to check is when we order from Office Depot, I have no way of knowing until we get the invoice that there was a tariff.”
Edwards said the biggest charge that she noticed was an 8 percent surcharge on dog waste bags the village had ordered, which were made with plastic from China.
“It might behoove us to look for a US supplied bag,” said Dan Escmann, president pro-tempore.

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