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Iowa economist comments on Trump’s proposed 200 percent tariffs on John Deere products
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Iowa economist comments on Trump’s proposed 200 percent tariffs on John Deere products

DES MOINES, Iowa (Gray Media Iowa Capitol Bureau) – Donald Trump is threatening John Deere with high tariffs if the company actually moves some of its manufacturing jobs to Mexico.

On Monday, he said he would impose a 200 percent tariff on John Deere products if the company moves production to its planned plant in Ramos, Mexico.

“I’m informing John Deere right now. If you do that, we’ll put a 200% tariff on anything you want to sell to the United States. So if I win, John Deere will pay 200%. They haven’t started doing it yet. Maybe they haven’t even made the final decision yet. But I think they have – John Deere will do it and anyone else that does it, because it hurts our farmers. It hurts our production,” Trump said.

John Deere has taken several actions as farmers’ incomes have fallen over the past two years. Since March, the company has laid off more than 1,600 workers in Iowa. It has also begun moving some of its production to Mexico.

By threatening higher tariffs, Trump wants to force companies like John Deere to keep their production in the USA.

Peter Orazem, an economics professor at Iowa State University, says higher tariffs are unlikely to achieve Trump’s goal. “Making parts more expensive for John Deere isn’t going to help John Deere either, and it probably wouldn’t help create jobs in the United States. So I think some of these measures aren’t quite thought through,” he said.

Orazem said this increases the cost of parts imported into the U.S. and the cost of the finished product. “So the consumer loses and the company loses,” he said.

He says this has been tried before, when tariffs were imposed on liquid crystal displays, a component of laptops. He says the tariffs made this part so expensive that it was no longer profitable to manufacture parts of these laptops in the U.S., so production was moved overseas.

We contacted Governor Kim Reynolds, Iowa Secretary of Agriculture Mike Naig, and all Iowa representatives in the U.S. House of Representatives and their Democratic challengers to ask whether they would support Trump’s proposed tariffs and what they think the impact would be on producers and consumers.

Only Representatives Hinson and Miller-Meeks responded. Neither answered whether they supported the tariffs, but blamed the Biden administration for the current conditions.

Orazem says the president cannot simply decide to impose tariffs based on trade deals with Canada and Mexico. If Trump did so, an act of Congress would be required.

He does not believe that a 200 percent tariff on John Deere products could be introduced in the near future.

Conner Hendricks covers state government and politics for Gray Media-owned stations in Iowa. Email to [email protected]; and follow him on Facebook at Conner Hendricks TV or on X/Twitter @ConnerReports.

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