A Ball State University economist has released a policy statement that estimates fallout from President Donald Trump’s tariffs could result in the loss of more than 30,000 Hoosier jobs over the next seven years. Center for Business & Economic Research Director Mike Hicks says the "very conservative" estimates suggest big hits to Indiana’s Gross Domestic Product to the tune of $668 million next year alone if actions among the U.S., European Union, China and Canada persist. Sectors that stand to lose the most in Indiana, he says, include steel, aluminum, soybeans, corn and automobile manufacturing.
Hicks tells Inside INdiana Business the negative effects on the Hoosier economy would be felt short and long-term. "The retaliatory tariffs are going to target the things we’re really good at. So we’re going to see automobiles, automobile parts, anything that’s steel-using, steel producing, anything that’s agriculture is going to get clobbered," he said. "Indiana depends so heavily on manufacturing and agriculture that even a very modest trade war would be recessionary for the Midwest.
He says the U.S. appears to be headed toward a trade war, which historically, hasn’t worked out well for the economy. "The long-term experience that we’ve had in previous trade wars has been that whatever re-shoring occurs — it’s been fairly minimal — is more than offset by the general reduction in economic activity." Hicks adds he is sympathetic to Trump’s overall idea of reducing tariffs in the long-term, but says the actions as they’re being presented will have "unambiguously negative" consequences now and in the future.
"These tariffs are more than sufficient to threaten the U.S. economic recovery, which began in summer 2009," said Hicks in the statement. "The full tariff regime threatened by the U.S., the EU, China and Canada are sufficient to move the economy into recession in late 2018 or 2019. Fortunately, given the very rapid adjustments to trade policy, the likelihood of any tariff proposal surviving for more than a few weeks is very low."
You can view the full policy statement by clicking here.
Center for Business & Economic Research Director Mike Hicks tells Inside INdiana Business the negative effects on the Hoosier economy would be felt short and long-term.