Widespread tariff initiatives imposed by the Trump administration are sending investors into a panic amid the recent stock market plunge, but the policy may be good news for West Virginians.
What began as a call for fairer trade among nations has since escalated into a full-blown global trade war, with some countries retaliating against U.S. tariffs while others come to the table.
Here’s a straightforward explanation of the “tariff regime” – a term coined by Ben Shapiro, host of conservative podcast, “The Daily Wire,” who has criticized the policy – and what the average person should know about tariffs.
Tariffs are taxes imposed by governments on imported goods. When a foreign product is tariffed, the importing country must pay a percentage of the product value to the country it is importing to.
As a basic, fictitious example, if a U.S. company imports a $100 pair of Nike shoes made in China and a 50% tariff applies, the importer must pay $50 in tariffs to the U.S. government. This raises the total cost to $150, which is often passed on to the consumer.
Many are asking why President Donald Trump is hitting at least 90 countries with “reciprocal” tariffs.
“Reciprocal. That means they do it to us, and we do it to them,” Trump said.
Trump said other countries have exploited the United States for years, particularly China, which exports billions of dollars in goods to the U.S. while importing significantly fewer U.S. goods into their country.
“Liberation Day,” announced April 2, began with a universal 10% tariff on all imported goods, followed by further tariffs on April 9.
Two driving forces follow closely behind the tariff initiatives.
Firstly, the administration deemed aggressive retaliatory tariffs as the only way to reverse damage done to the economy and bring manufacturing jobs back to the U.S.
Secondly, the $36 trillion national debt – the largest in history – is a major motivator.
Tariffs provide a source of revenue, benefiting the administration by potentially enabling tax cuts. The decrease in payments made by taxpayers can be offset by income from other countries.
Marshall economics professor Robin McCutcheon said according to the U.S. treasury secretary, Scott Bessent, the reason for imposing tariffs is to increase funds paid to the federal government in excess of $750 billion.
If projections hold, Trump could eliminate all income taxes on people making less than $150,000 per year.
McCutcheon added in West Virginia, most residents earn significantly less than $150,000, with the median household income approximately $58,000 in 2023, reflecting a 2.19% increase from 2020, according to Neilsberg.
The elimination of income taxes, social security taxes, overtime and tips may liberate many Americans from the tax burden carried from the last 100 years – the reason the president called April 2 “Liberation Day.”
Holly Belmont can be contacted at [email protected].
