Editor’s note: This article was first posted by Metropolitan Milwaukee Association of Commerce president and CEO Dale Kooyenga on LinkedIn.
I engaged over 75 MMAC CEOs since the administration’s “Liberation Day” announcement. Here is what I’ve heard:
The multi-trillion-dollar question: Does Trump believe that tariffs will lead to additional prosperity? Or do they serve as a negotiation tactic to secure more favorable trading terms?
If Trump believes tariffs will lead to additional prosperity, the mindset would run counter to the MMAC business leaders I’ve spoken with, as well as most mainstream economists.
Tariffs are taxes, and a $600 billion tax will be a drag on the economy. $600 billion depletes more money from the economy than U.S. corporate taxes generate. It takes a creative mind to think tariffs of that scope would not lead to inflation.
It’s not one size fits all. Fighting to protect America’s steel industry from Chinese domination is a worthy endeavor. China’s excess steel production is larger than the entire U.S. output. In fact, it produces as much steel as the rest of the world’s countries combined. More narrow trade battles to protect America’s defense industrial base and fight these clear abuses are generally supported by the business leaders.
The majority of countries targeted by the Trump administration are longstanding allies and strategic partners. Several executives told me the tough talk delivered by Trump toward our allies is already hurting our goodwill in the marketplace. They said those purchasing American products may quietly boycott American goods due to the treatment they’re receiving.
Decisions made by businesses require a certain degree of confidence. The unpredictability and chaos caused by the breadth and speed of the tariffs make it difficult for organizations to understand their cost structure and sales prices.
Business executives would rather have competition and economic growth versus an economic slowdown and less competition.
Trump has also argued that his tariff policy will reinvigorate U.S. manufacturing and return jobs to our shores. Here’s the rub: It takes 3-5 years to build a factory here based on the complexity of the product and regulatory barriers in the industry. CEOs are leery to make large investments to circumvent tariffs when there will be a new president by the time a factory is built.
We’re dealing with a labor shortage. If the intent is to return manufacturing to the U.S., there has to be legal immigration reforms to provide a greater labor pool.
A deal is a deal. During his first term, the President replaced the NAFTA with the USMCA. That agreement is largely still intact and exempt from “Liberation Day” tariffs. It’s important that agreements we’ve entered are honored to maintain their sanctity.
Congress has to be involved. We’re a nation founded on “no taxation without representation.” All citizens, businesses and associations have the right to provide input to their representatives. In turn, they should have the courage and power to intervene on behalf of their communities’ best interest.
Dale Kooyenga is the president and CEO of the Metropolitan Milwaukee Association of Commerce (MMAC).
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- Wisconsin manufacturers re-examining their pricing methods to mitigate impact from tariffs
- Viewpoints: Trump, Vance on manufacturing: wrong again
- Regal Rexnord expects ‘negligible’ $60 million hit from tariffs
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- Wisconsin businesses back China tariffs, mixed on tariffs for North American neighbors
