‘Tariffs are worrying for families and businesses,’ says NW Norfolk MP James Wild

In his weekly column, MP James Wild discusses the USA’s trade tariffs…

Most people don’t think much about trade. Supply chains, tariffs, and subsidies aren’t usually topics of discussion around the dinner table — until suddenly they are as when there were shortages of products on the shelves during Covid or when jobs and sectors disappear under unfair competition from other countries.

Thanks to President Trump, tariffs are now very much in the headlines, and his decision to impose these taxes across the board is worrying for families and businesses.

While it is, of course, better that we have had tariffs of 10 per cent applied than those of 20 per cent on the EU, for example, it is still damaging to our economy. Our steel industry and car industry face even higher charges of 25 per cent which has seen one of the biggest manufacturers Jaguar Land Rover pause its exports. But it is not just the household names – the supply chains for these sectors cover our area and small businesses employing local people.

This unwelcome move should not come as a surprise though – President Trump repeatedly told everyone before and during the election that he loved tariffs. Yet the government didn’t grasp the initiative and negotiate with the new administration on a deal to avoid these tariffs for many months after the election. Now, it needs to step up those efforts to resolve tariffs on UK goods to protect jobs and consumers.

It was another president, Ronald Reagan, who clearly set out what we are seeing now - that high tariffs inevitably lead to retaliation by countries affected, triggering fierce trade wars. As he said: “The result is more and more tariffs, higher and higher trade barriers, and less and less competition.” That leads to higher prices, markets shrinking and businesses shutting down with job losses.

As a trading nation, the UK needs to be making those arguments loudly as a strong advocate of free trade and open markets as well as the rules-based system that has helped resolve trade disputes in the past. Losing that and dismantling the system would bring more uncertainty and instability. Starting a tariff war rather than reforming the system makes things worse. We should be holding countries like China to account when they don’t play to the rules.

The impact on the global economy is a major concern and the fallout continues. How prepared are we to respond to this? Well, the tariff hikes come only two weeks after the government’s emergency budget which again only left a small spending contingency despite the likelihood of tariffs coming.

As a result, our economy is in a fragile position and that has created more uncertainty over whether there will need to be higher taxes or spending cuts to meet the government’s “iron-clad” fiscal rules. During Treasury questions this week I challenged ministers to repeat to me the Chancellor’s promise not to come back with more higher taxes. They refused.

But perhaps there is some scope for a glimmer of optimism. President Trump admires Britain and prides himself on being a dealmaker. Our trade is in balance with the US. So if the government gets back to the table to negotiate a fair deal to protect jobs and consumers and jobs we will strongly support their efforts.

EDITOR: This column was written before President Trump suspended tariffs yesterday evening.