President Donald Trump’s trade tariffs are already claiming their first American victims. But duties on Chinese goods aren’t the ones causing the damage ― at least, not yet.
Tariffs imposed by the U.S. Commerce Department on Canadian newsprint in January and increased in March have caused the price of the paper product to skyrocket as much as 32 percent, hitting an already cash-strapped newspaper industry.
As a result, the Tampa Bay Times, which has won 12 Pulitzer Prizes, is being forced to lay off about 50 staffers, the Tampa Bay Business Journal reported Wednesday.
The paper’s CEO, Paul Tash, offered a frank assessment of the duties’ effect in a letter to readers published late last month, noting the Times uses 17,000 tons of newsprint a year. Thanks to Trump’s tariffs, the cost per ton of newsprint is now $800 instead of $600, upping the paper’s yearly bill by $3.4 million.
“Payroll is the only expense that is bigger than newsprint,” Tash wrote. “To help offset the extra expense of paper, publishers will eliminate jobs. Make no mistake: These tariffs will cause layoffs across American newspapers, including this one.”
“Make no mistake: These tariffs will cause layoffs across American newspapers, including this one.”
Oddly, according to the News Media Alliance, an industry group, the higher duties weren’t even championed by most American producers of newsprint, most of whom have transitioned to other paper products as demand has plummeted.
Instead, Trump’s Commerce Department imposed the tariff at the urging of just one newsprint mill in the Pacific Northwest: North Pacific Paper, or Norpac. The company is owned by a New York hedge fund, One Rock Capital.
Norpac’s mill in Washington employs about 260 people. An estimated 600,000 American jobs are in the newspaper publishing and commercial printing industry, CNN estimates.
“What we’re seeing with the newsprint tariffs is not a government acting to try to better the economy for its citizens,” notes News Media Alliance President David Chavern. “Instead, it is ‘political arbitrage’ by one private investment group — where they are effectively looking to use the U.S. government to tax local and community newspapers across the United States in order to bolster their own bottom line.”
In a statement to HuffPost on Thursday, Norpac disputed the notion that it alone benefits from the tariffs, emphasizing the trade imbalance between the two countries that includes all sorts wood products.
“U.S. mills have closed disproportionately relative to Canadian mills since 2012,” David Richey, a spokesman for the company, told HuffPost in an email. “Much more capacity has been idled on the U.S. side, because government subsidies in Canada have artificially reduced the cost to produce there. During this time, U.S. producers’ share of the American market has plummeted from 60 percent to 36 percent.”
Asked if the company would like to say anything to American workers, like those at the Tampa Bay Times who are losing their jobs as a result of Norpac’s successful lobbying, Richey had this to say:
While our company understands the concerns recently surfaced by some newspaper publishers, which also face a challenging marketplace, we strongly disagree with the notion that their industry requires low-priced, subsidized newsprint from Canada to sustain their own business model. NORPAC believes that high-quality journalism in communities across the country should not depend on unfairly traded inputs that cause material injury to a U.S. industry and American jobs.
This story has been updated with comment from Norpac.