Experts: Trump tariffs will increase consumer prices INDIANAPOLIS (WISH) — President-elect Donald Trump announced tariffs on Mexico, Canada, and China as soon as he takes office. While those tariffs were directed to other countries, economic experts say these tariffs can cost Americans money and jobs. “The US economy will suffer greatly,” said Gary Lemon, an economics professor at DePauw University. A tariff is a tax imposed on imported goods. Anything that’s produced outside the country will be taxed. Trump is proposing a 25% tax on goods from Mexico and Canada, and an additional 10% tax on China. Trump said its because of weakened borders that allow for illegal immigration and drugs. “So, we’ll be in a war,” Lemon said. “Not a shooting war, but an economic war where everyone will be a loser.” “If the tariffs he’s proposing actually comes to fruition then it will definitely lead to some higher prices,” said Kyle Anderson, a clinical assistant professor of business economics at the Indiana University Kelley School of Business. “So, what happens when that price gets paid? The producers have to pass that along in a form of higher prices.” Lemon says we could see inflation kick up by 2%. “We get a lot of our oil from Canada, and if we put a 25% tariff, I’ve seen estimates of gas prices go up 50-75 cents,” Lemon said. Experts say if used strategically and specifically, tariffs can help. Tariffs have been used in the past to protect industries or defense weapons. “There are strategic reasons why we might invest in certain technology,” Anderson said. “Tariffs are one way to protect those industries. What gets potentially harmful is when you talk about tariffs across the board.” And that’s what Trump is proposing. Tariffs across the board, including raw materials and goods, and that can include oil and lumber we import from Canada. “The price of lumber would grow up significantly now,” Anderson said. “If there are houses under construction or apartments. All these things are going to get more expensive and that’ll deter potential home buyers to people who work in the construction industry.” Both experts say it will create retaliation. Mexico President Claudia Sheinbaum Pardo suggested placing tariffs on US goods, and experts said that could impact our jobs and businesses.In Indiana, it could impact our export of pharmaceutical drugs and corn. “Take an Indiana corn farmer who happens to sell corn to Mexico,” Lemon said. “So, if there’s a tariff, his corn would be so expensive in Mexico, or they just won’t import it.” “Prices will go up,” Lemon said. “Some companies who couldn’t raise prices may go bankrupt and people will lose their jobs.” Indiana Governor Eric Holcomb wasn’t too concerned. He told News 8, “With everything there’s of course rhetoric, there’s of course messaging being sent. But until we get to the point where we see the actual details how we will play out, that will be a concern to me.” Experts say this may just be an attempt to open up negotiations. After the tariff announcement, Sheinbaum and Trump said they had a productive conversation Wednesday, although neither addressed the tariffs.