PortandTerminal.com, November 22, 2019
Tariffs endanger $186 billion in US economic activity and threaten 1.5 million US jobs a recent Port of Los Angeles study finds
LOS ANGELES, CA – Throughout the ongoing trade war with China, Gene Seroka has been an outspoken critic of the damage that it has inflicted upon the American economy and its workers.
Earlier this month, armed with a new study commissioned by the Port of Los Angeles that details the negative impacts of the China tariffs, Seroka headed to Washington to spread the word.
“We are now hitting a cliff on what the tariffs have done and the impact they have had on the Port of Los Angeles,” Seroka said Nov. 12 at a Washington, D.C., press conference where he unveiled the findings of a port-commissioned study on the tariffs’ effect.
What the study shows
The study, “By the Numbers: Jeopardizing the National Benefits of Trade through America’s Busiest Port Complex,” is based on international trade moving through the adjacent San Pedro ports of Los Angeles and Long Beach, the country’s largest container port complex.
Imports through the two ports flow to every state in the nation, the study points out, and goods grown or manufactured in every state are exported through Los Angeles and Long Beach to global markets, mostly Asia.
The study shows tariffs threaten nearly 1.5 million U.S. jobs and more than $186 billion of economic activity nationwide.
“The study focuses on the impacts of tariffs based on trade through the San Pedro Bay ports,” Seroka said. “The implications are much bigger when you consider all U.S. ports, so the effects that the Port of Los Angeles is seeing should concern all U.S. ports of entry.”
The study shows in detail the number of jobs and how much sales, income and taxes are at risk for every state due to tariffs. The study also shows the economic benefits of these imports and exports to each congressional district and the percentage in each hit by tariffs.
Rufus Yerxa, President of the National Foreign Trade Council agrees. “This study provides graphic proof that a trade policy relying on overuse of tariffs can rebound badly on America, causing more harm than good to our long-term economic health,” said Yerxa.
Tariffs and the trade wars have hit the U.S. agricultural sector particularly hard, according to the study, with 26% to 51% of agricultural exports from all 50 states hit by tariffs, based on trade through San Pedro Bay.
“If cargo traffic out of the San Pedro Bay ports is declining because of tariffs it means American farmers and ranchers are hurting,” said Angela Hofmann, Co-Executive Director of Farmers for Free Trade. “When tariffs cut off access to markets that are hungry for American livestock, grains, vegetables and other farm products, the economic pain reverberates from ports, to farms to Main Street businesses.”
“It may take months or years to bounce back”
Seroka recently cautioned the port’s Board of Harbor Commissioners that even if a trade deal is reached with China, it may take months or years for trade volumes to snap back.
At a Port of Los Angeles Harbor Commission meeting on Nov. 21. Commissioner Anthony Pirozzi Jr. asked Seroka “If this trade deal goes through… where will it go and when will we see it turn positive or will it?”
“We have done irreparable damage to the export communityGene Seroka, Executive Director, Port of Los Angeles
“I don’t think it will,” said Seroka. “We have done irreparable damage to the export community and by trying to attempt to go at this alone we have given sales leads to every other country in the world to do business with China, and the EU, as well as Canada and Mexico.”
Seroka continued, “Cargo is moving, especially in the agriculture space, from other geographies and those are not transactional agreements. Those will go on for some time. Even if a deal were to be struck today, it’s going to take us a long time to come back. And a long time meaning six months, 24, 36. We just cannot tell yet,” he informed the meeting’s audience.
“On the import side, it is a little bit more difficult because we have such a high level of inventory throughout the nation – whether it is brake pads or computer keyboards, finished goods that go into our retail sector that you and I buy online or go into the store. That is why you saw such a precipitous drop,” he said, referring to the port’s most recent trade data.
Download the study
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