Tariffs, trade wars and student budgets: Understanding the connection
Treasure Hardwick, Staff Writer
Have you ever noticed a price change on your favorite product? I think we can all agree that for most people, the price of living can be a headache. While many factors contribute to the rise and fall of prices on the market, tariffs may be the culprit.
In simple terms, a tariff is a tax imposed on imported and exported goods. They have been around since the 18th century. In fact, the Tariff Act of 1789 was one of the first bills passed by Congress.
Tariffs have two main purposes: to promote trade with other countries and to raise revenue for the federal government.
According to the Fordham Journal of Corporate and Financial Law, in America’s early years, the tariff provided as much as 95 percent of the revenue for the federal government. However, despite their positive effect on the economy in that time, some still credited the use of tariffs as the cause of the Great Depression. This, mixed with angry customers, created controversy over the tariffs.
Jon Boulet, an economics professor at North Greenville University, explained that in recent years, tariffs have sparked a trade war between China and the United States.
He explained that China’s trade regulations prohibit certain goods, such as finished wood, from passing through the country. Yet, it allows raw materials to enter without an issue. Boulet said that this is unfair and a manipulation of trade rules that benefits China and hurts other countries.
Not only has the tariff sparked controversy with China, but it has also caused tension between the U.S and Canada, as well as the U.S and Mexico.
However, when Donald Trump was sworn into office in 2025, he used the power of the U.S. economy to negotiate better terms with other countries such as China, Canada and Mexico.
These countries began to address key issues and attempt to clear the air because the U.S. economy is stronger and larger than theirs.
Boulet used an analogy of a Mac truck and a smart car. The Mac truck is the United States, and the smart car is Canada or Mexico. When two economies collide, the larger one has more control over the weaker one. Also, the smaller car cannot ignore the issue.
Besides the bigger issues like tension and trade wars, tariffs have an impact on the price of clothes, food and even products such as Apple devices.
As you can see tariffs have an impact. But why is this relevant to college students today? Well, while they may impact your wallet for better or for worse, tariffs also play a role in the future.
Boulet explained that the economy today may stretch a college student’s budget and lead to higher prices. Furthermore, taxes on educational needs such as textbooks and laptops may raise the cost and lead to a pricier education. Lastly, the economy may affect the job market and lead to fewer job opportunities.
Despite these possibilities, Boulet encouraged students to take risks in the future and put themselves out there when it comes to job possibilities.
