How the Trump Administration’s Tariffs Could Affect Coffee Advertising

With the reelection of President Donald Trump, a new era of the United States will be born, including a new economic climate. The largest and most Googled aspect of Trump’s plan for the American economy is his plan to implement tariffs. According to taxfoundation.org, tariffs are, “ taxes imposed by one country on goods imported from another country. Tariffs are trade barriers that raise prices, reduce available quantities of goods and services for US businesses and consumers, and create an economic burden on foreign exporters.” Trump’s tariffs will add 10-20% tax increase on all imports, but will specifically target China, Canada and Mexico by adding a 25% tax on products imported from Canada and Mexico and 35% tax on products imported from China (taxfoundation.org).

Although Trump and his campaign team claim that tariffs will cause taxes on “American families, workers and businesses to come down” (rncplatform.donaldjtrump.com), it’s arguably more likely that large corporations will choose to allow the prices of their products to rise to generate higher profits and cause the average American to pay more for everyday purchases. 

So, this will impact all Americans every day, as many products the average American buys are imported from other countries, from groceries to gas. But how will tariffs specifically impact the aspects of college life? By impacting the cost of our weekly (or daily) coffees. Coffee culture or “caffeine culture” runs rampant on college campuses. How will companies like Starbucks and Dunkin, that rely on imported coffee beans, maintain student’s loyalty as the price of their products go up?

My thought is that these companies will start to advertise the “quality” of their coffee beans and other products. Companies like Starbucks and Dunkin will be able to justify the higher prices per drink to their customers and will likely survive the implementation of these tariffs because of their brand loyalty, reputations as status symbols or ability to put out a multitude of convincing campaigns every year.

Unfortunately, that doesn’t mean smaller coffee companies will be able to do the same. Many college towns, like our beloved Athens, offer many coffee options from small businesses. There’s no guarantee that those companies will be able to operate as well once the cost of the products they need to make their drinks inflate, consequently making the price of their drinks rise as well. College is not the easiest time for students, both for mental and financial reasons, and it’s upsetting to envision a world where our weekly sweet treat becomes less of a $6 reward and more of a $10 expense.  

Some Quick Facts:

• President-elect Trump has promised to impose tariffs of 25 percent on all imports from Canada and Mexico and an additional 10 percent tariff on all imports from China when he takes office. If imposed permanently, we estimate these tariffs would generate $1.2 trillion in tax revenue from 2025 through 2034 on a conventional basis. In the long run, we estimate the tariffs would reduce GDP by 0.4 percent and employment by 344,900 jobs. Our estimates do not capture the effects of retaliation, nor the additional harms that would stem from starting a global trade war. (taxfoundation.org)  

• Our Trade deficit in goods has grown to over $1 Trillion Dollars a year. Republicans will support baseline Tariffs on Foreign Made goods, pass the Trump Reciprocal Trade Act, and respond to unfair Trading practices. As Tariffs on Foreign Producers go up, Taxes on American Workers, Families and Businesses can come down. (rncplatform.donaldjtrump.com)  

• Tariffs are taxes imposed by one country on goods imported from another country. Tariffs are trade barriers that raise prices, reduce available quantities of goods and services for US businesses and consumers and create an economic burden on foreign exporters. (taxfoundation.org)