8 min read
Mohit Jagwani runs the type of business President Trump doesn't seem to think much about when he raises or lowers tariffs. Yet it's small business owners like Jagwani who face unwelcome turmoil as Trump wages his trade war.
Jagwani owns a Houston company called Rubber Track Wholesale, which sells rubber tracks for heavy machinery such as excavators and loaders. Virtually all the products he sells are made in China because that's where the rubber trees are. He has already raised prices by around 15% in anticipation of higher costs caused by Trump's new tariffs on imports from China. But he's scrambling to control costs, get products he can afford, and protect profit margins.
"My sales are down from the time Trump took office," Jagwani said. "In a regular year, you buy what you need and you invest. But now we only have time to focus on inventory, to keep ourselves afloat. There's no time to think about growth. It's just survival."
Read more: The latest news and updates on Trump's tariffs
Trump has thrown thousands of American businesses off-balance with tariffs on some $3 trillion worth of imported goods that he has imposed and rescinded with almost no notice. There's a new 10% tariff on most imports, rising to 25% for steel, aluminum, and automobiles. Starting in March, Trump's import tax on Chinese goods was 145% until he lowered it to 30% on May 12.
Overall, the tax on imports has jumped from an average of 2.5% before Trump took office to about 18%. That's the highest average tariff since the 1930s. Economists are broadly forecasting weaker GDP and employment growth along with rising inflation as the higher cost of imports makes the US economy less efficient.
Trump says he wants to raise the cost of imports to encourage more domestic manufacturing. But in many cases, that's implausible, and the inevitable result of tariffs is simply higher prices and less consumer choice.
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Jim Coppins is president of Infinity Massage Chairs in Seabrook, N.H., and most of his products come from China, where there's a long history of massage as medicine. High-end massage chairs have never been made in the United States, so there's no domestic industry to revive.
Had Trump's 145% tariff on Chinese imports stayed in effect, Coppins would have slashed his company's lineup from 35 types of chairs to five or six and tried to find lower-cost sources. "That was like an embargo," Coppins said. "Unless you had insane margins, nobody could ship at that price, and we weren't. We were weeks from considering laying people off."
