Confused, chaotic, unpredictable, those are just a few of the words some politicians and business leaders use to describe the Trump administration’s tariff policies.
The President’s decisions have caused tumult in the markets here in the United States and around the world. The decisions have caused deep uncertainty because it is still unclear what tariff policies will stick, or which ones will get rescinded.
Rep. Raskin Addresses Issue
Representative Jamie Raskin (D-MD) tells MCM the President’s policies hurt the economy. They especially impact small businesses that cannot plan for the future.
“We’ve heard from a lot of small businesspeople. They can’t figure out how much prices are going to be. How can you do meaningful business planning and run a business when some days tariffs are up 10% which is bad enough, and some days they are up 25% or 40%,” Raskin said.
“When President Trump promises China is going to pay for it, we all know that is nonsense. The tariff tax is paid by the business, and the business is overwhelmingly passing it onto consumers,” he added.
Raskin’s ‘The Truth in Tariffs Act’
Last month Raskin introduced a bill in the House of Representatives called ‘The Truth in Tariffs Act’. The proposed legislation requires large retailers to clearly display the portion of an item’s price attributable to tariffs.
Raskin said businesses need to be transparent about their costs, and consumers deserve clarity. The Congressman said he also is concerned about the possibility of price gouging.
“The bill not only protects us from the President pulling the wool over our eyes and imposing these costs on us, it also guards against whatever bad apples are out there. Businesses that might jack up the cost of goods and tell people tariffs are to blame. So we want businesses to state the price of the good, and state the tariff price,” Raskin explained.
Higher Prices Likely Coming
He said he is concerned if prices go up on some products, they might not go back down.
“This is the problem with tampering with the market in prices, and you do not want to give people an excuse to engage in deceptive or fraudulent conduct. You also don’t want to create inflationary effects across the economy,” Raskin said.
He told MCM prices already are going up, and he expects they will go even higher in the coming months. In general, Raskin said he is not a fan of tariffs. He has equated what the Trump administration is doing to a national sales tax. He believes trade works well when the United States is a reliable partner.
“In our country we let other nations sell best what they can sell, and then we sell best what we can sell. In a certain limited context where there is unfair trade practices going on, we can use tariffs. But that’s not what is happening here. President Trump is basically launching a trade war against the entire world,” Raskin said.
President Overstepping His Authority?
He also believes the President has overstepped his authority in imposing his sweeping tariffs.
“Congress has always passed the tariffs in the past. The people’s Representatives had some voice in it. Nobody has had any voice in this, not the House, not the Senate. President Trump is claiming powers he does not have,” Raskin explained.
The Trump administration claims otherwise. This week a federal appeals court temporarily allowed the President’s tariffs to continue while legal challenges to what the President is doing is played out in court.
Local Toy Store Feeling the Impact
MCM also spoke with Erica Card, who is the store director of Child’s Play Toys and Books. The toy store is located at 5536 Connecticut Avenue Northwest in Washington, D.C. The small business also has stores in McLean and Arlington, Virginia.
She said the tariffs are having a major impact on the business. Card explained about 90% of the toys, books, and other items in her store are imported from other countries. She said the tariff situation is “horrible.” Card works as a buyer.
“Trying to figure out what companies have inventory, how long they’ll have the inventory, which companies are raising prices now. When will they raise prices? Are they doing a surcharge instead of just raising the cost of the product? So trying to work within those confines has been very, very difficult because it determines cash flow,” Card said.
“A lot of the toy companies that we deal with, they are doing a lot of waiting and seeing before they necessarily pass on the tariffs. A lot of companies tried to stock up on inventory. So with some companies we were able to order at a pre-tariff rate,” Card added.
Overseas Sellers Handling Tariffs in Different Ways
She explained some companies are eating the cost of the tariffs and instead just adding on a surcharge per item. So, a product’s cost is not rising as much. However, some companies pass along the tariffs. Others drop their offer of free freight to compensate for the fees.
Card finds the current unpredictability with the tariffs the biggest challenge. Published reports in early June say big chain stores like Walmart and Target increased some of their toy prices. So, an Etch-A-Sketch that cost $14.97 months ago sells now for $24.99 – a nearly 67% increase.
“Every day, things are changing, and so we have to adjust every day based on what companies are saying,” Card said.
Keeping Prices Reasonable
However, Card said her store tries to keep prices reasonable. If products become too expensive, she said her store will stop selling them.
“It doesn’t make sense for the consumer or us to continue that item because no one can really buy it at a certain point. We might try to find a similar item from somewhere else that is less expensive or find items to take that toy or book’s place,” Card explained.
She said her store values its customers. The company pays close attention to the pricing and tries to be respectful of its shoppers. She explains some of her customers in D.C. are federal workers or federal contractors, so they’ve either lost their job or do not know if they will have a job in the future. Card wants them to feel good about shopping in her store. And if the store has to raise prices on some items; it is because the store has no choice.
“We don’t want our customers to lose faith and trust in us or think we are trying to take advantage of them, which we are not. We are working really hard to make sure we are keeping the price in a way that is attainable for our customers so that they will be able to continue to shop with us,” Card said.
Advice for Holiday Shoppers
While Card cannot predict where tariffs will head, she did offer some advice to customers since the holiday shopping season is about six months away.
“If you see an item you like right now, I would buy it today. It is possible the item may not be available during the holidays, or the price might be higher,” she said.
Community Support
Card said despite all the uncertainties surrounding the tariffs, she is confident the company will get through this rough patch. That is because the business, which opened 39 years ago, has strong support from the community.
photo courtesy Child’s Play Toy Store
