While Donald Trump campaigned on lower prices and support for workers and rural America, his new tariff policies will have harrowing impacts on farmers and consumers. His staggering tariffs — the highest in more than a century — threaten skyrocketing prices for essentials like food. 

At the same time, they’ll worsen the existing crisis for American farm families. During his first administration, Trump’s tariff trade war required more than $32 billion in bailouts for farmers. The current reality is that U.S. farm policies have splintered rural economies. Small and medium-sized farms struggle to merely break even from farming. 

To be clear, tariffs are a powerful tool that can strengthen U.S. industries and agriculture economies and protect workers. But the wide-ranging, punitive Trump tariffs, absent other policies (especially those that tackle corporate greed), will make matters much worse for farmers and families.

What Are Tariffs?

Tariffs are taxes on imported goods, paid by importing companies to the importing country. A “tariff on Chinese products” means that U.S. companies importing goods from China pay a tax to the U.S. government. 

Some countries have responded with “retaliatory tariffs” on U.S. goods that they import, particularly those that the U.S. really needs a market for. For example, Canada — the second-largest importer of U.S. agriculture products in 2024 — retaliated with a 25% tariff on its import of U.S. agricultural products. 

This can lead to a trade war, where each country raises tariffs higher and higher. Companies that keep importing often pass along the tariffs they pay to consumers. A 10% tariff on a product from another country may mean the price we pay grows by 10%.

Tariffs make imports more expensive, which can support U.S. companies and workers by protecting local markets. Coupled with good domestic growth policy, tariffs can help reshore factories, rebuild food webs, support local economies, and create good, family-supporting jobs. They can also enforce good labor and food safety practices.

Tariffs have been a major part of Trump’s agenda since he came into office. But Trump misunderstands the role of tariffs in trade and industrial policy. He’s using them to bully other countries into supporting his immigrant-bashing cruelty. For instance, in February, Trump paused tariffs on Canada and Mexico after they made promises on immigration policy (including policies they’d announced months before!). 

Rather than helping U.S. workers, Trump is using them to coerce countries into doing his bidding. Meanwhile, farmers and families will feel the worst consequences of his wheeling and dealing.

Trump’s Tariffs Will Lead to Higher Prices for Consumers

As a result of Trump’s tariffs, consumers will face higher prices and more corporate price-gouging, with no benefit to U.S. farmers. For example, the tariffs affect foods like coffee and bananas, which just don’t make sense to grow in the United States. There is no U.S. banana or coffee industry that will benefit from making imports more expensive. 

By one estimate, Trump’s tariffs will lead to thousands of dollars in higher costs for families. They’ll raise the cost of food three times higher than last year’s inflation.

But what the experts haven’t calculated is the run-on effect of companies using the tariffs as an excuse to raise prices on other products. This is the same sort of price gouging we saw during the pandemic when companies used legitimate supply chain issues to drastically increase prices and profits.

We’re seeing this again with the recent bird flu outbreaks. As our recent research shows, egg giant Cal-Maine is using the bird flu to drive egg prices even higher, posting more than $1 billion in windfall profits. 

The U.S. food system is highly consolidated, meaning a few huge, powerful corporations dominate industries. This power allows them to raise prices and dodge accountability in the pursuit of profits. With Trump’s tariffs, we can expect our food system’s mega-corporations to seize on the crisis to sneak in higher prices, rip off families, and amass more wealth for themselves.

Trump’s Tariffs Hurt Farmers and Rural Economies

Under the status quo of U.S. farm policy, Trump’s tariffs will also do more harm than good for farmers and rural communities. In the first Trump Administration, a trade war led to devastating losses for farmers with plants already in the ground. 

Trump’s high tariffs on China, a major importer of U.S. agricultural goods, led to China’s retaliatory tariffs. This meant plummeting sales and income for farmers, even bankruptcies, leading to a massive government bailout.

Trump’s tariffs may be even more disastrous. That’s because, by themselves, they fail to address the root causes of our nation’s farm crisis: fragile, export-dependent markets controlled by huge corporations and fueled by overproduction of crops like soy and corn, all driven by decades of U.S. farm policy.

Policies like free trade agreements and successive Farm Bills have encouraged farmers to grow as much as possible, while the government finds markets overseas for them to sell to. This has put farmers on an ever-growing treadmill of overproduction, shrinking their income and making them more vulnerable to the changing winds of global trade.

Moreover, these policies incentivized big acreage, big machinery, and big companies. Polluting industries like factory farming, ethanol, and ultra-processed junk foods benefited the most. Large grain and meat corporations dominated and maximized profits on the world stage. 

Workers and consumers were not at the table while these policies were created. Rural economies, the environment, and public health have all suffered as a result. 

A wave of Trump’s tariff wand will not solve these problems and create fair food and farm markets at home. On the contrary, it will cause a collapse that taxpayers will have to bail out, just so Trump can bully other countries.

The Real Fix: Good Farm and Industrial Policy

Tariffs can be a good tool, particularly if coupled with strong policy. The good news is we know what that policy looks like. 

Tariffs should be paired with policies that support U.S. industries, like funding for building manufacturing plants. Trump’s first-term tariffs failed to do this. In fact, manufacturing construction only happened when the Biden administration coupled tariffs with huge supportive bills like the CHIPS Act, Inflation Reduction Act, and Bipartisan Infrastructure Law. But now, Trump is working to dismantle these investments.

At the same time, we need policies that support farmers, rural communities, and a fair food system. We’ve had policies back in the New Deal era that, while not applied equally, have done this. Supply management prevented overproduction and ensured farmers could earn a livable income. 

For example, they kept grain in reserves for times of scarcity and set price floors, or minimums. They instituted conservation programs that paid farmers to stop farming and protect the environment in times of oversupply, to prevent plummeting prices and farmer incomes. 

Supply management policies help keep food prices at a sweet spot where farmers can make a good income, while food stays affordable even in times of crisis. What’s more, research shows that keeping New Deal-era supply management policies would have cost taxpayers significantly less than the deregulation and globalization of the farm economy we’ve seen.

To Support Farmers and Families, Take on Corporate America

To actually support rural and working people and lower grocery prices, Trump would need to use government programs to level the playing field and stimulate the economy from the ground up. He would need to invest in conservation, nutrition, and rural water programs that support Americans while building resilient infrastructure. And importantly, he’d need to do something counter to his instincts and interests — take on corporate control. 

There are small beacons of hope here. In February, the Federal Trade Commission (FTC) announced it would keep the Biden administration’s strengthened merger guidelines, which incorporated detailed comments from Food & Water Watch. 

Last year, the FTC used these guidelines to defeat a merger between grocery giants Kroger and Albertsons. Such a merger would have made Kroger even larger and more powerful, allowing it to price gouge even more than it already has.

The Trump administration could use these guidelines to stop more illegal, harmful mergers. By countering big corporations and cracking down on corporate consolidation, it could fulfill its pledge to reduce grocery prices. 

In the meantime, we’ll be opposing Trump’s frenzied tariffs as they stand. Without strong farm and industrial policy, they are a cudgel to bully other countries and will only hurt wide swaths of the country. To defend farmers in the field and families at the grocery store, we need a crackdown on corporate abuses and an overhaul of our federal food and agriculture policies — Trump’s tyrannical tariffs won’t cut it.