Dear Community Member,

This week, the Administration announced expansive new tariffs on more than 100 trading partners of the United States, including our allies. The President’s bluster on tariffs is now turning into stark reality, and hard-working Americans will face the consequences. On Thursday, the stock market experienced its steepest decline since March 2020, dropping as much as 6% or $3.1 trillion in lost market value. There is a direct link between the president’s trade actions and the losses that many working families experienced in their retirement savings.

By imposing these broad tariffs, the highest rates since World War II, President Trump is ignoring the potential economic consequences of shrinking our international trade and slowing growth for domestic businesses, workers, and consumers. Instead of creating jobs and strengthening industries, these tariffs are likely to raise prices, disrupt supply chains, and provoke costly retaliation from allies and trading partners.

The impact of President Trump’s tariffs will be felt locally as our agriculture, technology, manufacturing, and small businesses rely on stable trade relationships and foreign markets. President Trump’s tariffs will not only shrink those markets but also will invite retaliation and reduce our competitiveness. As America retreats from global trade relationships, other countries, including China, will happily step forward and fill the void with more bilateral trade deals and regional agreements to suit their own ends, potentially leading to an entirely new global trade structure without the United States.

Despite the economic harm caused domestically and the retreat of United States leadership on trade internationally, Congress must continue to reclaim our authority over trade as mandated under the U.S. Constitution. Although it will be difficult given the Trump Administration and Speaker Johnson’s compliant majority, Congress must continue its fight for responsible trade policies that support working families, stimulate our economy, and bolster the credibility and leadership of our country.

The following newsletter provides additional information on what these tariffs mean for our local economy, our standing in the world, and what Congress can and should do about this executive overreach.

Thank you for your continued engagement. If you have any questions or concerns about how these tariffs affect you, please don’t hesitate to reach out.

Sincerely,

Jimmy Panetta
United States Representative
19th Congressional District, California

Rep. Panetta discusses the impact
of the Administration's tariffs on working families.
Press play on the above video or click HERE to watch Rep. Panetta's full interview.

What Are Tariffs and Why Do They Matter?

A tariff is essentially a tax on imported goods. When a tariff is imposed, the cost of affected goods rises, often forcing American businesses to pay more for materials and consumers to pay higher prices at the checkout. While tariffs can sometimes protect domestic industries, the Administration’s broad and erratic approach threatens our economy.


What Did the Administration Announce?

The Administration’s latest tariff package marks a significant escalation in its trade policy, affecting more than 100 countries, including key U.S. allies and trading partners. These tariffs are being imposed under the International Emergency Economic Powers Act (IEEPA), with the declared "emergency" being trade deficits. The sweeping measures include a baseline 10 percent tariff on all imports, with even steeper levies on specific nations and industries. "China will face a 34 percent tariff on its goods, while the European Union and Japan will be hit with 20 and 24 percent, respectively.

Global trading partners already are preparing countermeasures, particularly in Europe, where officials are considering targeted tariffs on American goods and services.


What is the Administration’s Reasoning for These Actions?

The President has provided little clarity on whether this is a negotiating tactic, a political maneuver, or an attempt to offset tax cuts for the wealthy. He believes the United States is “getting ripped off.”

The fact of the matter is that as trade has expanded globally, everyone benefits. The United States has seen a much bigger increase in wealth generation than our closest allies and trading partners over the last several decades, American families have benefited from the low prices of goods, and American businesses have benefited from diverse supply chains. The concern is that once tariffs take effect, they are difficult to reverse, leaving American families, businesses, and our economy to bear the cost.


How Will These Tariffs Affect the Economy?

These sweeping tariffs have already caused market instability, disrupted supply chains, and increased costs for American manufacturers who rely on imported materials. Many businesses will be forced to either absorb the added costs or pass them on to consumers, making everything from cars to household appliances more expensive.

The Yale Budget Lab estimates these tariffs will raise U.S. consumer prices by 2.3% in the short term, costing households $3,800 annually. It’s estimated a 10% tariff would raise prices by 1.3%, hitting everyday goods, food, and manufacturing costs, amounting to a $2,100 tax on households. Clothing prices will go up 17% as higher import tariffs hit textiles from Southeast Asia and Bangladesh. Trump’s tariffs could reduce U.S. economic growth, which was 2.8% in 2024, by 0.9 percentage points this year. And a sustained tariff war could cause a 10% contraction in the stock market, reducing retirement savings and investments.

Businesses and families in California face a particularly daunting reality. In 2024, nearly 16% of California’s GDP ($675 billion) came from goods trade. A trade war threatens key sectors of our economy, from technology to agriculture, which sustain jobs in California’s 19th Congressional District.

Rep. Panetta and Members of the Trade Subcommittee hold a press conference
discussing the impact of Trump’s tariffs on working families.
Press play on the above video or click HERE to listen to Rep. Panetta’s remarks.

How I am Taking Action

Congress must reassert its authority over trade policy to prevent any administration from unilaterally imposing sweeping tariffs without oversight. That’s why I introduced the Reclaim Trade Powers Act, legislation that would restore Congress’s role in approving major trade actions. Specifically, this bill would repeal outdated provisions that allow the president to impose broad tariffs without Congressional approval, ensuring that trade decisions are based on sound economic principles rather than political maneuvering.

Additionally, I have helped organize a coalition of leaders on the House Trade Subcommittee to rein in executive overreach. Alongside my legislation, we have introduced the Preventing Tariff Abuses Act, which would clarify that the International Emergency Economic Powers Act cannot be used to levy tariffs; the Congressional Trade Authority Act, which would require Congressional consent for Section 232 tariffs; and the Repealing Outdated and Unilateral Tariff Authorities Act, which would eliminate Section 338 tariff authority, preventing further disruption to global trade.

The Administration has drastically abused its trade authority, failing to consult Congress and potentially violating constitutional limits. We must restore Congress’s power over trade policy and ensure that our economy works for all Americans. I will keep fighting to protect our workers, our businesses, and our economy.

Rep. Panetta tours a local business in the 19th Congressional District
impacted by the Administration’s reckless trade policies.

I am in Congress to get things done and help the people of California’s 19th Congressional District. Unfortunately, we have an Administration that continues to enact policies that do just the opposite. We need a balanced trade policy that strengthens American industry without placing unnecessary burdens on working families. I will continue to work with my colleagues to advocate for responsible trade policies that support our economy and ensure fairness in global commerce.