The Great Debate - Dueling views on the most talked about topics.
Counselor editor-in-chief (above left)
First, let’s address tariffs, because it’s on everyone’s minds. I think 5% is possible and that won’t kill the promo market. Why? Because retail prices will go up even more and promo items will still have tons of marketing value. In the long term, having more factories in the U.S. isn’t a bad thing either.
Now the good news, which is significant. Under President Trump, you’re going to see regulations slashed, the corporate tax rate cut and the Affordable Care Act replaced. The end result will be a larger pool of money available to companies for investment, talent acquisition and marketing.
Regarding insurance, businesses will be able to go across state lines for plans – that means increased competition and reduced costs. A lower tax rate will put the onus on major U.S. corporations to hire and build in America, not abroad. Fewer regulations will protect firms from huge legal fees, red tape and inefficiencies.
These steps are the foundation for what matters: better salaries, more disposable income and higher consumer spending. On this path, GDP will rise. That’s great for the overall economy and, in turn, the promo market.
VP Editorial & Marketing Services (above right)
The president’s policies won’t be good for our industry and it’s really for one big reason: trade and international tariffs. If this industry faces a 35% or 45% tariff on products coming from China, then wow, there’s going to be trouble. Remember, just about everything still comes from China. That hasn’t changed.
Now listen, do I really think the eventual tariff is going to be that high? No, most likely not, but something’s going to happen. Trump said on the stump that he’d press China on trade and he threatened a large tariff thinking it’s going to protect U.S. jobs. Now he’s proposing to use a tariff on goods coming from Mexico to pay for a border wall. By law, Trump can use an executive order to create these tariffs. I know there are plenty of Republicans that are against tariffs, but in-party opposition hasn’t stopped Trump yet.
You can debate other policies, but let’s face it – any additional tariffs on goods coming from China will have a negative impact on this market. That’s the most important policy to watch. If prices on goods go up, you’ve got issues. You’ve got issues within the supply chain from top to bottom.