While fuel prices may have slightly cooled, inflation has certainly not slowed down.
The costs of everyday goods still remain at record highs, and New Jerseyans are feeling the financial squeeze. The Bureau of Labor Statistics’ August report showed inflation at 8.3% nationwide.
These inflated prices are untenable, and we need Congress to take action. Fortunately, there is a path forward. Repealing retaliatory tariffs such as Section 232 would lower prices on fundamental building materials, such as aluminum.
As a local business, we are attuned to economic disruptions; yet, the Rutgers University community depends on our quality construction services. We build off-campus housing for Rutgers students, as well as rental apartments for the New Brunswick community at large.
High building materials prices, such as aluminum, caused by Section 232, increase our operating costs and threaten our bottom line. When the cost of the raw materials we need to build becomes more expensive, it is a struggle to keep rents stable.
We can promote economic growth by reducing the cost of building materials. Section 232 tariffs have limited domestic supply and contributed to high market prices. For example, the price of aluminum per ton in 2018 was $1,600 and has now climbed to roughly $2,300.
As prices rise throughout the construction sector, all aspects of New Jersey’s economy are hurt. COVID-19 weakened our state’s economy, and we are working hard to fully recover. In New Jersey, unemployment spiked to nearly 16% in 2020. The private sector has had to overcome lower revenue and difficulty retaining and hiring employees.
Inflated costs for raw materials mean that finished goods and services are more expensive, placing a heavy strain on our economy. Furthermore, consumers are more fiscally wary and have cut back on spending, injecting less money into the market. Inflation has limited the business sector in serving customers. We cannot accept economic conditions, such as these unnecessary tariffs, that create fiscal strain.
Additionally, repealing Section 232 would help reach our climate goals. By eliminating these tariffs, America could access low-carbon aluminum that is forged through hydropower. This is a cleaner alternative to the more prevalent and cheaper Chinese aluminum forged in carbon-intensive smelters that burn coal.
Fortunately, U.S. Sens. Pat Toomey (R-Pa.) and Mark Warner (D-Va.) are working on a solution across party lines. Their legislation, called the Bicameral Congressional Trade Authority Act, would eliminate these harmful tariffs. New Jersey needs Congress to address this economic crisis. Eliminating Section 232 would be a smart first step to resolve mounting cost concerns for local businesses like us.
I believe that addressing these tariffs offers a concrete solution to inflated prices. Smart government policy on the federal level promotes a competitive market and lowers operating costs that will help drive New Jersey forward.
Mitchell Broder is the president of Construction Management Associates in New Brunswick.
