Jose Rodriguez MCALLEN – President Donald Trump’s global tariffs came into effect in late February with a 10% increase on imported goods.
Under section 122 of the Trade Act of 1974, this allows the president to enter trade agreements and impose global tariffs for 150 days.
According to the White House, the tariffs are part of a plan to bring back domestic production and create more jobs.
However, in a press release it stated that some agricultural products, such as oranges, beef and tomatoes are exempt from the tariffs.
Gautam Hazarika, UTRGV’s department chair of economics, explains the effects of global tariffs and how its persistence can influence production costs for businesses in the U.S.
Hazarika said that tariffs raise the cost of living because Americans buy a lot of imported goods.
“There is another negative effect,” Hazarika said. “And that is the imported goods are often raw materials for U.S. businesses. So, if the price of raw materials rises, it’s going to raise again the cost of production. And therefore, prices in supermarkets and so on. Tariffs are a bad idea that they are inflationary. They are in a sense a tax on the public.”
Ruben Cavazos, owner and manager of Ruben’s Grocery, said that he doesn’t focus on the news for economic updates.
Instead, he gets his updates by focusing on the day-to-day operations of his own business and the messages he gets from other vendors.
“We haven’t seen a large change, anything that really has affected us in any way, either positive or negative,” Cavazos said.
Ruben’s Grocery in McAllen sells products from different countries like Mexico, Argentina and Brazil.
Cavazos said that because of inflationary costs over the 55 years of business, he cannot guarantee which products will continue to be stocked in shelves.
“Prices go up when there is a problem with logistics or production,” Cavazos said. “Obviously, we saw that a lot during Covid, but all of those things are temporary and there’s always substitute products. So, for example, here at the store, because of the Topo Chico, that’s going to go away for a while, we’ve got Tehuacán water, which we think is actually better.”
Cavazos added that customer satisfaction is his number one priority, as it helps him adjust to changes in the market, offering shoppers affordable prices.
