WASHINGTON — Higher prices. Slower growth. Farmers losing access to their biggest foreign market.
Even President Donald Trump is warning that Americans might have to accept “a little pain” before they enjoy the fruits of his escalating trade fight with China.
On the pain part, if not necessarily on the “little” part, most economists agree with the president: The tariffs the United States and China are preparing to slap on each other’s goods would take an economic toll.
For now, optimists are clinging to tentative signals from the Trump administration that it may be prepared to negotiate with Beijing and avert a trade war.
But Wall Street is getting increasingly nervous. The Dow Jones industrial average lost 572 points Friday after being down as much as 767.
“There are no winners in trade wars,” said Nathan Sheets, chief economist at PGIM Fixed Income. “There are only losers.”
On Thursday, Trump ordered the U.S. trade representative to consider imposing tariffs on up to $100 billion worth of Chinese products. Those duties would come on top of the $50 billion in products the U.S. already has targeted in a dispute over Beijing’s sharp-elbowed drive to supplant America’s technological supremacy.
China has proposed tariffs of $50 billion on U.S. products that will squeeze apple growers in Washington, soybean farmers in Indiana and winemakers in California. And Beijing warned Friday that it will “counterattack with great strength” if the United States ups the ante.
Of course, it may not come to that.
“We’re absolutely willing to negotiate,” Treasury Secretary Steven Mnuchin said Friday on CNBC, adding, “I’m cautiously optimistic that we’ll be able to work this out.”
At the same time, Mnuchin warned, “There is the potential of a trade war.”
Economists already are calculating the potential damage if talks collapse and give way to the biggest trade dispute since World War II.
The dueling tariffs could shave 0.3 percentage points off both U.S. and Chinese annual economic growth, according to estimates by Gregory Daco, head of U.S. economics for the research firm Oxford Economics.
In the United States, Mark Zandi, chief economist of Moody’s Analytics, said the dispute could wipe out half the economic benefits of the tax cut Trump signed into law with great fanfare in December.
“There’s lots of different channels through which this hurts the economy,” Zandi said. “The most obvious is, it raises import prices. If American consumers have to spend more on Chinese imports, they have less to spend on everything else.”
In the first $50 billion in planned tariffs, the Trump administration was careful to limit the impact on American consumers, sticking mostly to industrial products, such as robots and engine parts.
But if the administration tries to triple the tariffs, they will be more likely to hit the low-price Chinese products such as electronics, toys and clothing.
The administration appears to be betting that China will back down because it has more to lose. It sent $375 billion in goods to the U.S. last year, while the United States sent only $130 billion worth of products to China.
But China has other ways to retaliate. It could cancel aircraft orders from Boeing, meddle with U.S. supply chains, or raise U.S. interest rates by selling Treasury bonds or buying fewer of them.
The Chinese appear confident they can withstand more pain than Americans can. In a democracy like the U.S., “if people start to hurt, they’re going to complain,” said Sheets, who was undersecretary for international affairs in the Obama administration Treasury Department.
They’re complaining already.
Zippy Duvall, president of the American Farm Bureau Federation lobbying group, warned that the dispute has “placed farmers and ranchers in a precarious position.”
“We have bills to pay and debts we must settle, and cannot afford to lose any market, much less one as important as China,” Duvall said.
Last year, the United States sold $12.4 billion in soybeans to China — nearly 60 percent of all U.S. soybean exports.
Trump, who received overwhelming support in rural America in the 2016 presidential election, has directed Agriculture Secretary Sonny Perdue “to implement a plan to protect our farmers and agricultural interests.” But a move to support American farmers could widen the trade dispute.
“Farmers in countries like Australia, Brazil, Argentina, Canada and Europe would now find it difficult to compete with newly subsidized U.S. agriculture,” said Chad Bown, senior fellow at the Peterson Institute for International Economics. “As a result, they might demand retaliation against U.S. exports or subsidies of their own.”
MORIAH — Moriah resident Crystal Boyle Stoddard asked Rep. Elise Stefanik, R-Willsboro, during an open forum in Moriah on Friday if she drove through the town before she came to the event.
“I asked the congresswoman, but she never answered my question,” Boyle Stoddard said after the event. “If the paper mill ever shut down, this place would be a ghost town. If I were coming to an area, I would drive around. I would find out about it. I’d do my checks and balances and get the facts. I’d find out how much the population has dropped, how many foreclosures … All I heard her talk about was (Washington) D.C., Plattsburgh, Watertown. She never mentioned Moriah.”
Coming in on the heels of a packed and sometimes provocative town hall in South Glens Falls on Thursday, Friday’s “Coffee with Your Congresswoman,” at the Moriah Volunteer Fire Department on Tarbell Hill Road, drew about 65 NY-21 constituents looking for answers to equally challenging and deeply-felt questions about what the congresswoman was doing to better their lives.
Moderated by The Sun Community News publisher Dan Alexander, Friday’s open forum followed the same guidelines as Thursday’s event. All attending were given a number and Alexander drew numbers from a clear box for questions.
Unlike Thursday’s more raucous forum, Friday’s town hall was more somber and the life struggles related to jobs, the economy, healthcare, immigration and the president’s behavior were evident in the expressed concerns of constituents, many of whom live in Essex County.
Take 71-year-old Sam Gangi, of Moriah, for instance, who shared his story during the forum. He owns his home, he’s had two businesses and he’s a Vietnam veteran. His taxes are killing him, the cost of gas is killing him and the price of home-heating oil is killing him.
“I’ve had two businesses, one that failed, and one that is now being run by my daughter and son-in-law since the death of my wife recently,” he said. “I’ve lived in the same house; I’ve contributed to the welfare of this town. I’ve got nothing from it since I moved here. I live in an area where I can’t even get cable or internet. I’m a property owner.”
“My working days are over and I live on a fixed income, and I feel like the government has only been there for the rich and forgotten the hardworking people who lured you people into office,” he continued. “Now, we have a crazy man in Washington who is going to ruin our country with this insanity and a bunch of representatives who are afraid to stand up to him and call him for what he is: nuts. What we need from you isn’t just words, but someone who will back up those needs.”
The audience applauded.
Stefanik said that the town is working on innovative solutions to technology, although she did not offer specifics.
“We have a governor who promised to connect every part of the district and he still has not done that,” she said, adding that Assemblyman Dan Stec, R-Queensbury, and NY Sen. Betty Little, R-Queensbury, are on top of tackling the issue.
“The second half of your question was about the president,” Stefanik continued. “Some people want me to approve of him 100 percent of the time, others want me to disagree with him 100 percent of the time. That’s just not my job. I gotta call ‘em like I see ‘em. There are some issues with the president where I agree and some where I disagree.”
NY-21 Democratic challenger Katie Wilson, Keene, who is also on the November election ballot for the Working People’s Party against Stefanik, was one of the forum’s first questioners.
“As a challenger, I’ve spent about 50,000 miles in however many months traveling the district, and what I’ve run into are people who are really struggling and really angry,” Wilson said. “And so, I’d like to know what is your plan and your concrete steps to improve the lives of these hardworking people that you are representing?”
“People are angry, people are angry on all sides … whether you’re angry and disagree with the president or whether previously you were angry with the direction our country is moving in,” she said. “I think we need to focus on economic growth and creating jobs, specifically in upstate and the North Country. There are a couple of ways that I’ve really tried to delve into one is workforce development; are we promoting our career and technical educational programs?”
Without offering the steps to take, Stefanik said there needs to be a continuing focus on workforce development with Canada because it creates 15 percent of the jobs in Clinton County, for example.
“We also need to look at what our specific strengths are. So obviously we have the Adirondacks, a huge tourism opportunity,” she said.
John Sharkey, of Ticonderoga, asked about the tax cut bill and as part of his question referred to a “certain politician who said it was only going to result in crumbs for the American people.”
He also talked about local businesses who are now offering work bonuses and more money funneled into retirement funds because of the new tax law. “I just want to know your feelings about the tax cut and what does it mean for the North Country, because we need businesses to come here,” he said.
“I think Nancy Pelosi’s (Rep. Nancy Pelosi, D-CA) comments about crumbs, when you’re talking about hundreds of thousands of dollars that is a real difference for families in the district and families across the country, was a woefully out of touch comment,” Stefanik said.
Assemblyman Stec asked Stefanik, “What do you find most frustrating in Washington, D.C.? What gets your blood boiling the most?
The congresswoman said she asks him the same question about Albany.
“What I find frustrating is the pace and the gridlock. I find myself to be a bipartisan member of Congress … that is how we get things done in this country. I’m frustrated with the national media’s focus on the fighting rather than some of the bipartisan victories,” she said, adding that the majority of bills passed are done on a bipartisan basis. “But you often don’t hear that because it’s not as controversial.”
In other responses, the congresswoman said she does not support Medicare for all; that there must be a balance when looking at prescription drug costs to not stifle innovation; and that many of the North Country economic problems stem from the governor’s office.
Mary Ann Johnson, of Crown Point, wanted to know about assault weapons and if there can be some kind of ban on such weapons.
“What can we do to get assault weapons away from gatherings like this?” she asked. “It could happen right here to this group of people, it could happen at a school concert, the movie theater, the malls.”
Stefanik said she believes in protecting the Second Amendment.
“Automatic weapons are not legal in this country. I do not support legalizing automatic weapons. But there are many gun owners who are law-abiding citizens, thousands in this district that own semi-automatic weapons and they use them for recreation, they use them for sport, they use them in some cases for hunting,” Stefanik said. “These are law-abiding citizens and I respect their Second Amendment rights.”
The weapon used to kill 17 in the Parkland, Florida high school shooting was an AR-15, a semi-automatic weapon.
Similar to the South Glens Falls forum, Stefanik took additional questions and remained afterward to talk with constituents.
National Grid had about 3,500 customers in the region still without power Friday afternoon from windstorm-related damage, and the company planned to hand out bottled water and dry ice Friday to help those who are out.
Hamilton and northern Warren counties continued to have the most problems well into Friday, with the towns of Horicon, Chester, Schroon, Corinth and Lake Pleasant worst off. More than 5,500 had been out at the beginning of the day, and the total fell steadily through the day.
The company hopes to have most customers back on line as of late Friday night, but some outages will linger into Saturday afternoon.
“They are down to a point where they are dealing with individual outages of 20 here or 30 there, and those are going to take some time,” said Warren County Emergency Services Coordinator Brian LaFlure. “I know they are also dealing with a shortage of (utility) poles. But I would hope they would be able to have most of them back on by tonight.”
LaFlure said the county emergency dispatch center dealt with a number of calls Thursday for possible carbon monoxide exposure that seemed to be linked to generator use without proper ventilation. Electrical generators should never be used inside a structure.
Horicon was among the worst-off local towns as of early Friday. The Duell Hill Road area, which is a higher elevation than much of the town, seemed hardest-hit, town Supervisor Matt Simpson said.
“I think people are handling it fairly well,” Simpson said.
High winds late Wednesday took down trees and wires around the region, snapping utility poles as well. National Grid brought in crews from around the state to help repair the damage.
National Grid distributed bottled water and dry ice to area residents who have lost power Friday at the Warren County Department of Public Works building on Route 9 in Warrensburg, and they will be distributing more at the DPW on Saturday from 10 a.m. to 5 p.m.
Dry ice can be used to keep food cold.
National Grid also provided tips to use dry ice to extend the life of cold food:
JOHNSBURG — State Police are looking into a local skier’s claims that he spent a cold, snowy night stuck on a lift at Gore Mountain Ski Center over the weekend after the lift shut down for the day while he was headed up the mountain.
The skier, whose name wasn’t released, reported that he was on the North Quad late Saturday afternoon when it stopped as he headed up for one last trip down. He was not found until the lift was restarted at 8 a.m. Sunday, and he reported he was on the lift overnight as an inch or two of snow fell and temperatures dropped into the 20s.
He was unhurt and declined medical treatment. Gore Mountain staff contacted State Police though, and a trooper from the agency had interviewed the skier on two occasions this week.
The man reported he was stuck on a chair on the High Peaks lift and was suspended about 30 feet off the mountainside. It was unclear whether he had a cellphone, but cell service is spotty on lower portions of the mountain, depending on location.
A Gore Mountain official acknowledged the incident, but would not release details Friday.
Gore Mountain is run by the state Olympic Regional Development Authority, and ORDA spokesman Jon Lundin said the State Police were looking into the situation, but he declined to discuss it further.
“We are aware of the report and are seeking to confirm the facts,” he said.
It’s not unprecedented for skiers to get stuck on lifts overnight, locally and at ski areas around the world. A movie titled “Frozen” was made in 2010 about a particularly cold, grueling experience of skiers stranded for hours.
West Mountain Ski Center dealt with a highly publicized incident in February 1993, when two skiers spent 12 hours on a lift that was stopped as they were being taken up the mountain.
The men were found after a search that started when loved ones of the two men reported them missing when they did not come home from skiing. They were treated at Glens Falls Hospital for possible frostbite and hypothermia.