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13 Apr 2025 9:09
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  •   Home > News > Business

    Donald Trump's trade war takes toll on Americans as US tariffs begin to bite

    On-again-off-again tariffs and an intensifying trade war with China are taking their toll on ordinary Americans in a range of ways.


    Rick Huether's family business has survived a world war, the Cold War, the global financial crisis and COVID-19.

    Now, the can manufacturer is working out how to navigate his 96-year-old company through Donald Trump's trade war.

    "I wake up at three or four o'clock in the morning and start trying to solve problems in my brain," Rick says.

    "It's very stressful. You spend a lot of time talking to customers, spend a lot of time talking to employees to make sure they feel comfortable that they're working in a business that's going to be here in three or four months."

    Rick employs about 400 people in factories in Maryland and Ohio, producing specialty tins, cans and buckets that multinational companies no longer typically make.

    The Independent Can Company was initially hit by Trump's tariffs in his first term, when a 25 per cent tax was placed on steel imports in 2018.

    American mills don't produce enough of the steel tinplate Rick needs for his cookie tins and popcorn cans, so he imports large amounts from Germany.

    Now, in Trump's second term, the uncertainty of on-and-off tariff announcements is paralysing planning for many businesses like Rick's.

    Since his re-election, Trump has extended the steel tariff to previously exempt countries and increased aluminium tariffs. He has imposed, removed and repeatedly changed tariffs on Mexico and Canada. Large "reciprocal" tariffs were put on scores of trade partners, then reduced to 10 per cent to allow for negotiations, which Trump says will result in better trade deals for America.

    "We can live with the realities," says Rick, whose machinery and parts also come from abroad. "We just need the realities not to change weekly, monthly or quarterly. We need them to be realities for a number of years.

    "What's going on now is freezing us to make sure we don't make a decision today that was a good one and tomorrow find out it's a bad decision."

    Regrets in Chinatown

    Among all the evolving elements of Trump's tariffs policy, it's the trade war with China that's developing most rapidly and dramatically.

    The world's two largest superpowers are refusing to back down in a tense trade tug-of-war. After the US hiked the tariff on Chinese imports to 145 per cent, China retaliated on Friday with a 125 per cent tariff on American goods.

    American small businesses are paying the price.

    New York is home to the biggest population of people of Chinese extraction outside Asia.

    Its Chinatown is an iconic part of Manhattan and many of its store owners worry about how they'll survive the geopolitical stand-off.

    Ken Li has run his K. K. Discount Store for nearly 35 years and says: "This is the worst time."

    Worse than the pandemic, worse than the aftermath of 9/11.

    He says the unpredictability makes it impossible to plan.

    "We don't know what's going on tomorrow," he says.

    "Maybe tonight I go home, then another story comes out."

    Ken and his wife moved to New York from Hong Kong about 50 years ago, with little money in his pocket. After working odd jobs for about five years, he saved enough to start his shop. It's almost entirely stocked with products sourced from China.

    When Trump first started laying tariffs on China at the start of his second term in office, Ken was worried about the impact on sales as he was forced to raise prices.

    But as the trade war has ratcheted up, he's now worried about even being able to source products to sell. Importers are concerned about shipping products and paying the new tariffs with the risk the taxes could then be abruptly dropped. It would leave them with holding stock that's relatively expensive.

    While some large companies may have tried to get ahead of the tariffs by stockpiling product, Ken says that's impossible for businesses like his.

    "I don't have extra money to use to do storage," he says.

    He voted for Trump at the presidential election, hoping he'd be good for the economy and would crack down on illegal migration. But he's deeply disappointed by how Trump's handled the trade war and how it's hurting his livelihood.

    "He needs to think about all Americans, not only big companies," he says.

    "You need to care [about] the small business."

    Taking stock

    In Maryland, Rick Huether is confident his business will get through this wave of tariffs. He says there were "bright spots" that came with the first round seven years ago, including new customers who chose to deal domestically because of the extra costs of manufacturing overseas.

    The 25 per cent steel tariff was also a boon for steel mills across the country.

    The Steel Manufacturers Association celebrated Trump's early April 'Liberation Day' tariffs, calling the president a "champion" of the domestic industry.

    But for Rick, the 2018 tariffs had some big downsides too. They were a contributing factor for downsizing the family business and closing a plant in Iowa.

    "It was terrible," Rick says.

    "We had to spread our overhead over a smaller base because our margins had been shrunk because of [the] increased cost of steel."

    The US's National Small Business Advocate says its 65,000 members have varying opinions on the tariffs, but surveys in December and January found more than half were concerned about them, with a third "very concerned".

    "I suspect the outlook might be a little different today now that so many additional tariffs have been imposed much more broadly," vice-president of public affairs Molly Day said in a statement this week.

    "There are growing concerns about overall economic stability and what that means for business sustainability and growth."

    Retirement fund whiplash

    Trump's pause on higher tariff rates for specific countries may have eased concerns about a global trade war for the time being. But the stock market whiplash is being felt disproportionately by retirees, whose retirement funds are tightly tied to US stocks.

    Maryland man Gregory Kilduff, 70, watched his savings plummet earlier in the week.

    "I've already lost more than $30,000 in my retirement account and I'm not going to be working again, so it's very scary," he says.

    The market then surged, only to start sliding again.

    "It seems unnecessary, the fear," he says.

    Maryland's Victor Kilian, 81, is in a similar situation. He says his 401k retirement savings dropped at least 15 to 20 per cent over the week.

    "If someone asked me if I'm better off under President [Joe] Biden or President Trump, I'm much better off under President Biden," he says.

    But Trump still has support from many of his voters. Michigan resident Jan Hodge says her gold investments are up and the president should "go for it".

    "I put myself through school working at all the little shops in town making auto parts," she says.

    "You can't do that anymore. There's just no employment, so if he can bring back shops into all these little towns in mid-America, that'd be great."

    Oklahoma local Linda Barton also voted for Trump and says she has "some trust" everything will work out.

    "Things recovered after the downturn with COVID and I have confidence that the market will upturn," the 71-year-old says.

    "You can't say that he didn't say he was going to do this. He campaigned on this."


    ABC




    © 2025 ABC Australian Broadcasting Corporation. All rights reserved

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