Grading & Excavation Contractor

One, Two, Three, Four, Who Wants to Have a Trade War?

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Do you remember having “thumb wars”? It’s that game in which you would lock fists with another person with your thumb sticking up and you would alternately tap from one side of the combined fist to the other counting down, “one, two, three, four, we declare a thumb war” and then you would try to pin down the other person’s thumb with your thumb.

If you’ve never had a thumb war and are having a hard time picturing it, please refer to the following video:

We had thumb wars when we were kids in the back seat of my parents’ station wagon to pass the time doing something mindless on a long road trip. It was a simple game that no one ever really won.

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Last week, President Trump announced that he plans to implement a 25% tariff on steel imports and a 10% tariff on aluminum imports. It seems to be his attempt to level the playing field when it comes to trade deficits in the steel and aluminum industries. Later he tweeted that “trade wars are good and easy to win.”

Here’s the reaction from Dennis Slater, the president of the Association of Equipment Manufacturers (AEM):

“President Trump shouldn’t undercut his own goal of helping US manufacturers ‘win’ again by imposing counterproductive tariffs on steel imports. The president should reconsider his stated intention to impose tariffs on steel and aluminum imports that will raise costs for equipment manufacturers in the US and undermine our industry’s global competitiveness.

About 30% of equipment manufactured in the US is eventually intended for export. Tariffs or quotas on steel and aluminum imports will burden US manufacturers with higher costs while our competitors in China, India, and Mexico will get a free pass to use the cheapest input materials they can find.

If President Trump wants to boost domestic steel production, the best way would be to invest in our infrastructure system, and focus on further streamlining regulations.”

Stephen Sandherr, the chief executive officer of the Association of General Contractors of America (AGC) had this reaction:

“Making construction, infrastructure, and development projects more expensive by imposing new trade barriers will do far more damage to the economy than any limited benefits new tariffs or quotas might provide. Worse, increasing the cost of construction will only undermine the President’s ambitions to rebuild the nation’s aging and over-burdened infrastructure.”

The negative response to Trump’s proposed tariffs on steel and aluminum not only came from construction machinery OEMs, they also came from the auto industry, the beer industry, the retail sector, boat manufacturers, and a host of US business groups.

American steel companies like the idea.

This most definitely will not be as simple as a thumb war. But if the President insists… one, two, three, four…


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