To the editor: Rep. Morrow: Trump tariffs to impact local home-building, food costs

This week, Gov. Phil Scott presented his budget proposal for the next fiscal year and we heard more details on his education system overhaul plan. In addition, there was much discussion around the impacts of President Trump’s policies on Vermonters – both the tariffs on Mexico, Canada and China and his freezing (and possibly eliminating) funding for state programs. These will have substantial, real-world impacts on all of us.

I try to stick to state issues but, in this case, federal issues are state issues. The tariffs, which go into effect on Tuesday, will be highly inflationary. Expect the cost of many things to go up noticeably. For instance, my committee on Energy and Digital Infrastructure looks at the energy mix of the state. Green Mountain Power gets a significant portion of its electricity from Hydro-Quebec.

The tariff of 10% will likely be passed onto customers in the coming weeks. Our friends in the northwest part of the state who are customers of Vermont Gas will also see a big jump. It is still unclear how much heating fuel and gas prices will go up.

The United States imports a large amount ($46 billion last year) of food, particularly fruits and vegetables, from Mexico, and grain, livestock and poultry from Canada. These will be hit with a 25% tariff. The U.S. imported $151 billion worth of motor vehicles and vehicle parts from Mexico last year and these were the second-largest goods imported from Canada. These will also be hit with a 25% tariff.

Softwoods for construction? Over 30% was imported from Canada. So much for making it easier to build housing. You get the idea … this will affect every part of our economy, hurting small businesses and consumers. It will also stop the decline of interest rates and, possibly, force them higher depending on the extent and duration of inflation.

I was surprised to find out how much of our state budget was reliant on federal funds – 36%.

Here is a more detailed breakdown of how much of our budget is paid for by the feds:

• public safety – 33%,
• Department of Health – 42%,
• Fish & Wildlife – 32%,
• housing – 45%.
• The big one is Medicaid – 61%.

We have no idea which of these programs will be impacted by the new administration, or by how much. Uncertainty and chaos are hard to plan around. The important point here is not the numbers, but that there will be very real negative impacts on Vermonters.

If you want to catch up on state news, here are two articles about the issues of the week:

• Gov. Scott’s budget proposal.
• The proposal to overhaul of education.

And for a glimpse behind the scenes and a great primer on public safety issues in Vermont, listen to this 20-minute podcast from House Speaker Jill Krowinski on Youtube.

Please keep in touch,

Rep. Chris Morrow
Windham-Windsor-Bennington District
cmorrow@leg.state.vt.us