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  •   Home > News > International

    Three months on from 'Liberation Day', Donald Trump's trade war is punishing US businesses

    Donald Trump's tariffs were designed to punish foreign nations who ran trade deficits with the US. Instead, the policy has put the businesses and industries he's seeking to protect in the crosshairs.


    Farmer John Ashe's dealt with drought. He's dealt with hurricanes.

    But what he saw the US president announce on TV left him speechless.

    "I just shook my head. My wife was shaking her head, and I was thinking, what's next?" he says.

    Almost 90 days ago, Donald Trump shocked the world when he announced his so-called reciprocal tariffs on more than 180 countries and territories.

    Designed to punish foreign nations who ran trade deficits with the US, the tariffs have instead put much of Trump's heartland in the crosshairs.

    In Austin, Texas, toy manufacturer Molson Hart watched as President Trump brandished a game show-like list of tariffed countries.

    "When I first saw that sign, I wasn't sure if it was real. It was just unbelievable. People weren't expecting those kinds of numbers," he says.

    Since President Trump's inauguration he has announced more than 50 new or revised tariffs, including pauses, backdowns, escalations and de-escalations.

    Business owners and workers across the US are reeling from the chaos and confusion unleashed by Trump's trade policy.

    And with only days to go until a temporary pause on the highest "reciprocal" tariffs is due to be lifted, there are fears about what comes next.

    'You cannot take a chainsaw and do surgery'

    John Ashe's family has been farming in North Carolina across four generations.

    "Not many families can say this, Black families that is, but we've been here for over a hundred years.

    "My great-grandfather, my grandfather on both sides, and my father, were all farmers."

    Mr Ashe, who exports around 40-45 per cent of his soybean crop to China, watched on in horror as the president lit the fuse on a trade war that saw the US impose 145 per cent tariffs on Chinese imports and China retaliate with 125 per cent tariffs.

    "Honestly, I cannot understand it. I have not heard anybody from that administration that could tell me anything that makes any sense of what he's causing," Mr Ashe says.

    "You cannot take a chainsaw and do surgery."

    When Four Corners visited Mr Ashe's farm, the trade war was at its peak, and he was planting his first soybean crop of the season.

    "I'm going to plant about 50 per cent less than I would normally because I don't know what the price is going to be. I don't want to take the risk of putting even more out there," he says.

    US soybean exports to China are worth around $US13 billion ($19.9 billion) a year. After Donald Trump brought in tariffs on China during his first term, and China retaliated, Brazil overtook the US as the world's largest soy producer.

    Mr Ashe is worried these lucrative markets for US farmers will continue to evaporate.

    "I'm concerned that they're going to find other places around the world that can fulfil their needs," he says.

    "Sometimes you find another grocery store you like and you don't go to your old grocery store anymore."

    Mr Ashe has watched over the last few months as the tariffs have gone up and down. US tariffs on China are currently at 30 per cent, while Chinese tariffs on US imports sit at 10 per cent.

    The uncertainty makes it difficult to plan what crops to sow.

    "I've never seen anything like this before. It just seems like it changes from lunchtime to the six o'clock news," he says.

    Toying with trade

    When Donald Trump ignited his trade war with China, Molson Hart started scrambling.

    He needed to find factories outside of China to make toys before he ran out of stock.

    "It's enormously difficult," he says.

    "It takes six months to a year to properly move production depending on what you're making. In some cases, it's not even possible to do."

    The 38-year-old's company, Viahart, makes plush animals and a construction toy called Brain Flakes.

    When the highest tariffs on China were paused, Mr Hart was able to re-order more stock for his Texas warehouse, but he is still looking to shift production to South-East Asia.

    Mr Hart says the ongoing uncertainty around Trump's trade policy has eroded business confidence across the country.

    "We don't know if it will be high tariffs, low tariffs or something in between," he says.

    "All these importers need to get that extra money to pay the tariffs and when there's less money to go around for things, confidence in business in general declines."

    The US Toy Association says nearly 80 per cent of toys sold in the US are made in China, and the industry is predicting price rises, supply shortages and bankruptcies.

    Mr Hart described Trump's trade policy as "probably the worst economic policy I've ever seen" and says he does not think it will meet its stated aim of bringing back American manufacturing.

    "We need to have a plan. For example, if our goal is to make things in America, 'This is what the timeline is, and this is how we're going to achieve it, and we're going to be doing it in these industries'.

    "We can't adapt our businesses to this crazy uncertainty."

    Mr Hart understands trade with China better than most. He has worked in Chinese factories and his products are made there. He speaks Mandarin and has been in the manufacturing industry for 15 years.

    He says even if the policies managed to bring manufacturing back to the US, it's unclear if the labour force is there to do the work.

    "I work with some fantastic people in the United States, but it will take some training and some time and possibly some sort of mental adjustment period for Americans to start doing some of the jobs that are done in China. They're really hard," he says.

    Made in America

    Dan Turner has voted Republican since the Reagan years and supports Donald Trump's goal of reviving the US manufacturing industry.

    "It's really a staple of civilisation. I think that we need to make things," he says.

    In his workshop in Carlilse, Pennsylvania, Mr Turner employs around 40 staff who design, install and repair hydraulic components.

    Turner Hydraulics began in the backyard of his parents' home in 1978 when around 20 per cent of American workers were employed in manufacturing. That figure has now plummeted to around 8 per cent.

    "I like seeing my employees being able to get ahead. I believe in that and that's why I think small business is the backbone of America," he says.

    But so far, Donald Trump's tariffs have done no favours to Turner Hydraulics.

    In January, before the tariffs were introduced Mr Turner ordered a hydraulic component from China worth $US48,000.

    By the time the product was on the water heading to the US, Mr Trump's tariffs meant the part would cost him around $US130,000.

    "The tariff total was going to be 170 per cent, which was around $US82,000 up from the $US12,000 that we had planned on.

    "To suck $US70,000 out of a business, with no good reason is very detrimental."

    Like many other small business owners relying on parts from China, Mr Turner would have preferred a transition period rather than the chaotic announcement and escalation, particularly given he works in the industry President Trump says he's seeking to protect.

    "As a manufacturer, it would've been nice to have been told that here's the sequence of events and you have this many months before tariffs are going to increase.

    "I know I'm just a small part of this whole puzzle. There are companies that are potentially getting hit with millions of dollars of tariffs," he says.

    Big problems for small business

    Ed Brzytwa is the vice president of international trade at the Consumer Technology Association (CTA) which represents over 1,200 technology and innovation companies in North America.

    He says small businesses are disproportionately impacted by tariffs.

    "When you put tariffs on imports, whether it's on the finished goods or on the raw material or on the input, all you're doing is disrupting supply chains and making things more expensive," Mr Brzytwa says.

    "Printed circuit boards are one input that you need to make certain finished goods in the United States, and that component is almost entirely made in China.

    "[CTA members] are reliant on international trade to survive. If you want to make an innovative product for the very competitive US marketplace, you need to have access to affordable inputs.

    "A tariff is not a plan to re-shore manufacturing."

    In mid-May the chaos of Trump's trade policy suddenly improved things for Dan Turner's business.

    "We just found out this morning that the tariff will be 55 per cent, which is a lot better than 170 per cent," he says.

    It meant that the tariff he would pay on his $US48,000 component had fallen to around $US27,000 — far less than the estimated $US82,000 he had been expecting. Had the part arrived just two days earlier, he would have been stung with the 170 per cent tariff.

    Despite the changes, Mr Turner remains nervous about ordering any more parts from China.

    "We are on hold with ordering anything from China and with investing in finding alternative routes. We will research it, but we won't be making any investment into it," he says.

    So how long will this uncertainty hover over his business for?

    "Maybe another three and a half years?" he laughs.

    'It makes me want to cry'

    Trump's trade war with China has deeply impacted the industries built around the nation's once thriving ports.

    Mark Nieves is truck driver who transports goods from the docks of New York, New Jersey and Philadelphia.

    "I am a third-generation trucker, what we call a pier rat. I love this industry, it runs in my blood," he says.

    As supply lines from China have dried up, truck drivers like Mark have watched their pay-packets diminish. 

    "The tariffs have caused me to work one day a week, two days a week, robbing from Peter to pay Paul," Mr Nieves says. 

    "It makes me want to cry sometimes. I'm angry, I'm troubled. I just think we can do better as a country." 

    Mr Nieves has worked in transport for more than 40 years, including in safety, supply chain, operations management and truck driving. 

    He is the president and founder of the United Drayage Drivers Association. He says deregulation has already made the industry tough and the tariffs have made it even worse. 

    As Four Corners rode in his truck near the port of New York in mid-May, he pointed to rows and rows of empty containers. 

    "These are empties that have come back to the port without a destination. Usually you see a full pier, full of containers and now you see a full yard, full of empties side by side," he says. 

    There are more than 3.5 million truck drivers in the US and many of them voted for Donald Trump in the 2024 election.

    Mr Nieves was unimpressed by the US president's response when he was asked about the impact his tariffs had on dock workers and truck drivers at a media conference.

    "I saw his interview with the news media and how they asked him, 'Hey, truckers in the ports are really struggling, right?' And his response was 'good, at least China's not stealing from us'.

    "It's not about China, it's about us. [I felt] very sad that an American president would let the country collapse from within itself, only because he wants to prove a point."

    Mr Nieves is running as a Republican candidate for the Union County Commission in New Jersey and hopes to be a voice for truck drivers struggling to make ends meet.

    In the meantime, he wants Trump to start listening to the people who have been hit the hardest by his tariffs.

    "The country has spoken, and he is our president, and I support him a hundred per cent. However, I think he could have handled it much better," he says.

    "He should have gotten the consultation of real people who, live this industry, who know this industry."

    Watch Four Corners' full investigation, Trading in Chaos, tonight from 8:30pm on ABC TV and ABC iview

    © 2025 ABC Australian Broadcasting Corporation. All rights reserved

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