Missy Hughes on Trump's Reciprocal Tariffs and Wisconsin

Frederica Freyberg:
The Trump tariffs hit this week. The across-the-board taxes on imports into the U.S. are combined with reciprocal tariffs hiking the tax on countries with larger trade imbalances. Holding steady with the 25% tariffs on Canada and Mexico on steel and aluminum, and on cars for other countries, the 10% baseline tariffs on all goods imported into the U.S. will see higher reciprocal rates, like the 20% tariffs on imports from the European Union. Governor Tony Evers and CEO of the Wisconsin Economic Development Corporation, Missy Hughes, are just now on a trade mission to France and Germany. Is this good timing or bad? We turn to Secretary Missy Hughes, who’s in France. And thanks very much for joining us from there.

Missy Hughes:
Yeah, good afternoon from France.

Frederica Freyberg:
So, Secretary Hughes, what has been the reaction where you are to these U.S. tariffs?

Missy Hughes:
Well, we’ve really seen generally a lot of disappointment from the French officials and the German officials and the businesses that we’ve been meeting with. It’s a real surprise over what’s happened. You know, everyone has expressed to me, we have had incredible long-term friendships and really a lot of confusion and misunderstanding or, you know, confusion about what’s happening and what the future holds.

Frederica Freyberg:
So as to retaliatory tariffs being considered by other countries, what will that mean for U.S. exports, particularly for Wisconsin?

Missy Hughes:
Well, for Wisconsin, we’re going to see challenges around, especially our industrial machinery, our large pieces of machines and equipment that we are building and exporting to countries like Germany for use for food processing and the medical industry. So we’re really going to face real challenges for our businesses. And we have businesses every day that, like businesses we’ve brought here to Germany that are exploring exporting. And this is really going to be a challenge for them as they seek new markets.

Frederica Freyberg:
So your trade mission is to promote exports, of course. And international investments in especially, I understand, Wisconsin’s biohealth sector. For its part, I understand that France is talking about targeting U.S., the U.S. tech sector. What do you say to your counterparts in Europe in the face of this?

Missy Hughes:
Well, first and foremost, you know, things are changing every day. So before we even get into conversations about tariffs, we’re talking about our long-term partnerships. We’re talking about how Wisconsin is here, ready to continue these relationships. But when we’re talking about retaliatory tariffs or the tariffs that the U.S. is putting on these countries, it’s really concern about sending the economy into a recession. And there’s a fear that even if the tariffs are alleviated, the chill, chilling effect that this is going to have on the economy and the potential recession is really causing concerns for future investment.

Frederica Freyberg:
So we are seeing the stock market sinking. Certainly consumer confidence is unsteady. You speak about recession for Wisconsin, for the U.S., for the globe?

Missy Hughes:
Yeah. You know, I mean, if you, if you think about the impacts of the tariffs, a company that might be making an investment, a company that might be hiring people is going to stop and say, well, let’s wait and see what happens. And that has a domino effect, then really creating a slowdown and really creating a recession. I have companies that are talking to me from Wisconsin who are very concerned about what the future holds. They have relied on open trade between Mexico and Canada. They’ve created supply chains in that way, and now they’re really worried about what’s going to be the future and this unpredictability and instability is really hard for businesses to plan around.

Frederica Freyberg:
As to the tariffs on Mexico and Canada, what is the current and potential future impact on Wisconsin?

Missy Hughes:
Well, I think first and foremost, we’re going to see impacts on everyday Wisconsinites’ pocketbooks. We’re going to see increases in grocery costs. We’re going to see increases in gas and prices. And that’s really going to be having an effect right away. Longer term we’ll see companies really thinking about how do they re-jigger their supply chains. And can they do that because they’ve relied on buying from Mexico or buying from Canada and even sending parts back and forth across the borders. And now they’re going to have to make decisions about how to continue to make that work, or to move into new or more difficult types of business.

Frederica Freyberg:
So overall, should we expect higher prices on just about everything?

Missy Hughes:
It’s hard to imagine that this isn’t going to have an impact through and through and through. Even a company I was talking to that imports coffee is facing incredible tariffs. And so we can expect you know, just at the beginning of our day with coffee to have higher costs. And you know we might see increased costs in health care because we’ll see medical devices and perhaps drugs costing more. So I think everywhere we’re going to see real challenges to what we expect and how we pay our bills.

Frederica Freyberg:
What can someone like you in your position do about any of this?

Missy Hughes:
Well, first and foremost, we want to provide really good information to our companies. As you’ve pointed out, the tariffs are complex. Whether they’re reciprocal or coming into the country. We want to make sure they have the best information about that and then as they explore ways to mitigate risks or ways to move their supply chain around, we want to be there with the best information to be able to supply them and help them react in the most successful way.

Frederica Freyberg:
Secretary Missy Hughes, joining us from France. Thanks so much.

Missy Hughes:
Thank you.