The attentive public in The Bahamas must be aware that the political directorate in The United States is issuing Executive Orders and announcing changes that would negatively impact our economy.

Over the last several days there were many protest marches in several U.S. cities with Americans expressing their displeasure on presidential over-reach on several issues.  Some of them would undoubtedly create political challenges in The Bahamas.  Despite the best efforts of the Davis administration, inflation remains an intractable issue which is being addressed in many ways.

The proposed tariff plans by the Trump administration are worrisome for political leaders in The Bahamas and the entire Caribbean, as additional tariffs will exacerbate the socio-economic challenges.  However, it is the responsibility of the government and media to properly educate consumers that inflation is imported from our largest trading partner, The United States, where competitive subsidized agricultural production contrasts sharply with the high costs of small-scale farming in The Bahamas and the Caribbean, including rising input costs.

While the government has in place price control measures in certain categories of food to assist consumers, there is a limit on just how far it can go to render assistance in the face of higher import costs, including freight or transportation charges borne by Wholesalers and Retailers.

Over the last several days, the Trump administration placed on pause a decision to increase tariffs by 25 percent on imports for Mexico and Canada.  It increased tariffs on China by 10 percent.

If implemented, the plans would pare back the most sweeping elements of Trump’s campaign plans, but still would be likely to upend global trade and carry major consequences for the U.S. economy and consumers.

While all of this is politically unpopular and disruptive, it brings instability to our economy, as it increases the food bill of The Bahamas.  There are growing fears around the Bahamas that the cost of living is going to be higher with Trump in the White House.

The U.S. Federal Reserve in December signaled that officials expect just two interest rate cuts for this year, as price increases remain stickier than initially forecast.

The Trump plans would, if put into effect, amount to one of the biggest challenges in decades to the global order.  Trump’s advisers view this as necessary to bring manufacturing jobs back to the U.S. economy, but it could invite retaliation from the rest of the world and drive prices up for consumers and businesses alike.

In the U.S., Liberal and Conservative critics say that even more moderate versions of Trump’s campaign trade plans are still extreme, arguing that sweeping tariffs would drive up prices for U.S. consumers and manufacturers.

During his first term, Trump imposed tariffs on more than $360 billion worth of goods from China, particularly steel and aluminum.  His trade threats were largely focused on Beijing, but they rattled global trade and sparked major tensions with America’s geopolitical allies.

Mexico accounts for more than 87 percent of certain U.S. steel imports, with the total level nearly 500 percent over its historic baseline. The surge in Mexican steel into the United States has coincided with the closure of some U.S. factories in Chicago and California. 

During the campaign Trump said: “Tariffs alone created this vast wealth for our country … Tariffs will pay off our debt and make America wealthy again.”  Well, the U.S. Stock Market declined sharply this week before Trump pulled back on his tariff threats with Canada and Mexico.

Among other challenges resulting from Trump’s second term is the issue of birthright citizenship which is currently being challenged in courts in the United States.  Most legal scholars believe the President’s interpretation of the law which has been in place for some two hundred years is just wrong and unconstitutional.  So, Bahamians like others around the world wait in a period of great anxiety.