By imposing taxes on an additional $200 billion in Chinese goods, President Donald Trump has intensified a battle of wills between the world's two largest economies -- and the outcome is far from certain.


But what's clear is the latest fight in the escalating trade war is likely, one way or another, to affect consumers, companies, markets, the economy, and the political landscape.

And how all that plays out could determine whether Trump's negotiating gamble proves a triumph or a failure. Here is a look at those likely to be impacted:



"As president, it is my duty to protect the interests of working men and women, farmers, ranchers, businesses, and our country itself," Trump said in a statement.

Starting Monday, the United States is to begin charging a 10 percent tax on thousands of Chinese imports -- tires, windshield wipers, baseball gloves, bicycles, snakeskin pants, backpacks, trombone cases, refrigerators, and wooden furniture, among others. The list runs 194 pages.

Unless the administration reaches a truce with Beijing, Trump's import tax will jump to 25 percent in 2019. What's more, if Beijing retaliates, Trump says he's ready to impose tariffs on an additional $267 billion in Chinese goods.



"The mere talk of tariffs on all remaining Chinese imports is of serious concern to retailers since tariffs of that magnitude would touch every aspect of American life," said Matthew Shay, chief executive of the National Retail Federation, a trade group for retailers.


Many companies have warned that Trump's tariffs threaten to disrupt their businesses and depress their revenue.

The monthly manufacturing index by the Institute of Supply Management noted that some companies have expressed concern about tariffs despite an otherwise robust U.S. economy. One food and beverage firm in the ISM survey said, "Suppliers appear to be bracing us for cost increases, given increased talk of tariffs and inflation."


No longer can they ignore tariffs, which were low and mostly headed lower before Trump took office. They now need to rethink the supply chains they've built across countries and calculate where best to deploy workers.

"They're definitely going to move jobs," Murphy said. "What Trump is doing is increasing the cost, and he's introducing uncertainty into trade relations. Businesses can deal with costs. It's the uncertainty they can't deal with."

Financial Markets

So far, at least, the stock market has taken the threats of tariffs in stride. Share prices have dipped only to then resume their growth, in part because of deep corporate tax cuts that took effect this year and a solid U.S. economy in its 10th straight year of expansion.

But the new round of tariffs risks triggering a more alarming response by investors. The additional taxes suggest the two countries are struggling to make progress in settling their differences. The issues include Chinese companies' theft of U.S. intellectual property and a widening trade gap as U.S. consumers have become more dependent on comparatively cheap Chinese imports.

"It's definitely a setback for the market that they can't seem to get to the table," said J.J. Kinahan, chief market strategist for TD Ameritrade.


Global Economy

A prolonged trade war between the United States, the world's largest economy, and China, the second-largest, would ripple through the rest of the globe, potentially affecting economies from Buenos Aires to Istanbul.





The Republicans' control of the House and Senate is at stake in the midterm congressional races in November. Trump has portrayed the import taxes as a winning electoral issue because they're forcing other countries to compromise with the United States.

But public opinion suggests that his tariffs could prove a vulnerability. A poll released August 24 by The Associated Press-NORC Center for Public Affairs Research found that 61 percent of Americans disapproved of the president's handling of trade negotiations.

If Democrats win, it would possibly repudiate Trump's approach. But if many Republicans retain their seats, it could vindicate Trump's choice to announce tariffs so close to the elections.


"Many family farms are afraid they won't be able to pay the bills if this misguided trade war continues," Heitkamp said in a statement. "There are smart ways to deal with China's cheating on trade, but stepping on our farmers is not one of them."

AP writers Paul Wiseman and Marley Jay contributed to this report.

Published on: Sep 18, 2018