Donald Trump has proposed raising tariffs in a second term. But how would this impact North Carolina? While the notion of protecting American industries might sound appealing, history shows that aggressive tariffs lead to higher inflation, drive up consumer costs, and create harmful ripple effects for local economies. North Carolina, with its connections to manufacturing, agriculture, and retail, is particularly vulnerable to the consequences of such extreme trade policies.
The most concerning aspect of Trump’s tariff proposal is his unilateral authority to implement it. Unlike other controversial ideas that require congressional approval, a president has significant direct power over trade policy. Trump’s proposed tariffs would shift the nation from competing globally to adopting protectionist policies that would burden North Carolina’s families and businesses with increased costs and reduced competitiveness. North Carolina’s success has long relied on open trade and fair competition, and protectionism threatens to unravel that progress.
Tariffs would result in steep price hikes across nearly every sector, from food and clothing to cars and appliances. For North Carolinians already grappling with inflation, this policy would hit households hard, making basic necessities significantly more expensive. Tariffs raise the cost of imported goods, and domestic manufacturers are less inclined to keep prices competitive in a closed market.
Household staples, from washing machines to clothing, would also become costlier. When tariffs were placed on washing machines in 2018, prices rose by 12%, according to the Federal Reserve. Imagine the effect if tariffs were set at 200% for some vehicles, as Trump has proposed. Essential items would become luxuries for many. Working-class families, who make up a significant portion of North Carolina’s population, would bear the brunt of these price increases, reducing their purchasing power and quality of life.
North Carolina’s economy is built on industries that would be disproportionately affected by these tariffs, especially in manufacturing, agriculture, and retail. Although our state has diversified with technology and finance, manufacturing and agriculture remain crucial, particularly in rural areas. These industries are highly sensitive to trade disruptions and rely heavily on export markets.
Take the textile and apparel industry, once the backbone of North Carolina’s economy and still an essential source of jobs. Many manufacturers depend on imported materials, like fabrics and thread. With a 200% tariff on these imports, manufacturers would face a choice: absorb the costs and reduce their margins or pass the cost onto consumers. As prices increase, demand would likely decrease, leading to potential layoffs in an industry that has already endured significant challenges.
We’ve seen this happen before; when Trump imposed tariffs on Chinese goods in 2018, North Carolina’s textile manufacturers faced higher production costs and saw revenue decline.
The impact would be similarly devastating for North Carolina’s $92 billion agricultural sector. Our state is one of the country’s top producers of pork, tobacco, and sweet potatoes, much of which is exported internationally. When the US-China trade war escalated in 2018, China retaliated by imposing tariffs on American agricultural products. As a result, North Carolina’s pork producers alone lost millions, and some farmers struggled to make ends meet.
Additional tariffs would almost certainly invite similar retaliation, putting our farmers in jeopardy once again. North Carolina’s agricultural exports are a vital part of the state economy, and a trade war would jeopardize the livelihood of thousands of rural families.
Trump’s proposal marks a shift from competing globally to adopting a protectionist stance that threatens North Carolina’s growth. Our state has spent decades building an economy integrated with global markets, creating jobs, fostering innovation, and attracting foreign investment.
The Research Triangle Park (RTP), one of the largest research parks in the world, thrives because of international partnerships and investments, drawing entrepreneurs and talent from around the globe. Charlotte’s financial sector, which employs thousands, benefits from a global outlook, and banking is an inherently international business.
Protectionism puts all this at risk. Rather than shielding American companies from foreign competition, we should be supporting policies that make our businesses more competitive on a global scale. Policies that encourage fair trade practices, workforce training, and innovation are the right path forward. North Carolina’s economic success relies on an environment that attracts businesses and investments, not one that isolates us.
Economic damage from protectionist policies isn’t just theoretical — it’s backed by history. In 1930, the Smoot-Hawley Tariff Act raised tariffs on thousands of goods, triggering a trade war that deepened the Great Depression. The lesson is clear: aggressive tariffs don’t work. They harm both consumers and businesses, creating economic pain and isolation.
Recent evidence shows similar outcomes. The tariffs Trump imposed in 2018 increased costs for both manufacturers and consumers. A study by the American Action Forum found that the tariffs cost the average American household $1,277 in 2020. North Carolina families can’t afford another round of tariffs that inflate prices and threaten economic stability.
Instead of leaning into protectionism, North Carolina and the nation would benefit from trade policies that enhance competitiveness and encourage growth. We should be pushing for fair trade agreements that create a level playing field, supporting innovation, and investing in education and technology. North Carolina’s leadership in finance, technology, and agriculture depends on policies that open doors, not close them.