Potential retaliatory tariffs' effects on Oklahoma, U.S.

OKLAHOMA CITY (KFOR) - We first told you Monday about potential tariffs threatened by President-elect Trump and their effects on the U.S. economy if they come to fruition.

The economist we spoke with also mentioned retaliatory tariffs that could impact our state and as it turns out, they have in the past.

"This is economic policy that, you know, every party can agree is not helpful to the U.S. economy,” University of Central Oklahoma Associate Professor and Dept. of Economics Chair Travis Roach, Ph.D., said.

Roach described his concerns on a potential 25 percent across the board tariff for Mexico and Canada as well as an additional 10 percent tariff for China. His other concern though was retaliatory tariffs and their effects on Oklahoma since the state is a major exporter to both Canada and Mexico.

"Suppose these countries decide to retaliate with their own tariffs that harms our own firms and industries within the state,” he said.

The Office of the U.S. Trade Representative shows Oklahoma exporting about $1.6 billion in goods to Canada in 2018. The state exported another $780 million in goods to Mexico that same year.

Per the Associated Press, both Canada and Mexico have looked into that possibility.

"This happened during the first presidency where our farms and our rural areas were specifically hurt by Trump's policies,” Roach said.

That was back in 2018. The U.S. imposed tariffs on steel and aluminum imports and that brought retaliatory tariffs from a number of countries including Mexico, Canada and China. Per the U.S. Dept. of Agriculture that lost the U.S. over $13 billion between 2018 and 2019 on a number of ag products. A lot of those losses were concentrated in the Midwest with Oklahoma specifically losing between $100 million and $250 million dollars.

In December 2018, the Oklahoman reported more than 2,000 Oklahoma farmers and ranchers got payments totaling 2 million dollars from the Trump administration to offset those losses.

"This is really just us kind of shooting ourselves in the foot,” Roach said.

We reached out to both the Governor’s office and State Farm Bureau for comments and are waiting to hear back.