Sorry, Dad: Trump’s Tariffs Will Destroy Your Father’s Day
Americans spend more than $12 billion on gifts for Dad on Father’s Day, with the typical gift being over $100.1 Of those who buy gifts, 40% will purchase clothes, 22% books or CDs, 20% electronics, 15% sporting goods, 14% gardening supplies, 14% tools and appliances, and 13% on automotive accessories according to the National Retail Federation’s 2015 Father’s Day Spending Survey.*2
Amid this consumer activity, presumptive Republican nominee Donald Trump has touted his plan to slap tariffs of 45% on Chinese imports and 35% on Mexican imports. While experts have denounced Trump’s economic plan, saying it would cause a trade war, lead to millions of job losses, and trigger a recession, it’s also clear that Trump’s tariffs would also certainly make everyday items more expensive for American consumers.3 But how much more expensive?
With Father’s Day upon us, we looked at typical gift items that people buy for their Dad—from a tie, to a wallet, to a set of golf clubs. With Trump’s tariffs, these 10 goods will cost $336 more than they do now. Here’s how that works:
How do we figure out what Trump’s tariffs would cost?
We calculated the average unit cost of these products as they hit the U.S. border and before retail markup, based on public data from the U.S. International Trade Commission.4 Drawing on a formula from a Progressive Economy study, we assumed that the final store price of each good is roughly triple the unit cost (also called “landed cost”), and we then added state sales tax.5 We then looked at how Trump’s 45% tariffs on Chinese imports increase the unit cost of each of these products as they hit the U.S. shore. We assumed current import levels, noting that while foreign production may move to other countries (say from China to Vietnam) to reduce costs, that may be easier said than done and would take time. Also, China is by far the leading global manufacturer of these items. For instance, Chinese-made golf clubs represent 83% of U.S. golf club imports. In addition, for this paper, we assumed 100% of the tariff would be applied to the product and applied before retail markup. But, we do not include this increased tariff in the calculation that is generally used for retail markup. Further, the percentage of each good that was imported into the United States from China is based on HS data from the USITC Dataweb.6
A nice, new leather wallet for Dad would now cost an additional $3.99 because of Trump’s tariffs. Thirty-nine percent of U.S. wallet imports come from China—the #1 exporter of these items to the U.S.
Want to hit the links with Dad? Trump’s tariffs would add an additional $162.71 to the price of a new set of 12 clubs. Eighty-three percent of U.S. imports of golf clubs come from China.
Trump’s tariffs would add an additional $5.15 to the price of a new electric razor. Fifty-seven percent of U.S. imports of electric razors come from China.
Getting your Dad a new suit or a blazer for Father’s Day? That’s going to cost an additional $10.43 with Trump’s tariffs. Thirty-eight percent of U.S. imports of suits come from China—the #1 exporter of these items to the U.S.
A sweater for your dad? That’s going to run you an additional $3.20 because of Trump’s tariffs. Twenty-five percent of U.S. sweater imports come from China—the #1 exporter of these items to the U.S.
Maybe you want to get your father a power tool, like drill or saw? Trump’s tariffs would add an additional $20.52 to the price of a new power tool. Fifty-seven percent of U.S imports of a power tool come from China.
A new camera for Dad would cost you an additional $27.37 because of Trump’s tariffs. Forty-two percent of U.S. camera imports come from China—the #1 exporter of these items to the U.S.
If you want to upgrade your Dad’s phone to the latest model, that’s going to cost you an additional $96.56 with Trump’s tariffs. Seventy-seven percent of U.S. phone imports come from China.
Maybe you want to get your father a new bag that he can take to work or take on a weekend trip? Trump’s tariffs would add an additional $4.59 to the price of a new necktie. Seventy-eight percent of U.S. imports of bags come from China.
Maybe you want to get your father something he can wear to work? Trump’s tariffs would even add an additional $1.01 to the price of a new necktie. Seventy percent of U.S. imports of watches come from China.
Donald Trump has repeatedly said that implementing tariffs on China and Mexico are designed to protect U.S. workers and businesses. Instead, he’s simply hurting consumers. On Father’s Day, let’s celebrate our dads—not tax them more.