May 10, 2019
I’m not kidding. The first sentence of an article on the Trump administration’s plans to impose a 17.5 percent tariff on Mexican tomatoes told readers:
“The United States will impose a 17.5 percent tariff on Mexican tomato imports starting Tuesday, and economists say that could lead to shortages and price increases of up to 85 percent as soon as this winter.”
The idea that more than 400 percent of a tariff could be passed on to U.S. consumers should strike readers as a bit bizarre. After all, if the full 17.5 percent tariff was passed on to U.S. consumers in higher prices, then Mexican producers are getting just as much money on each pound of tomatoes they sell as before the tariff was in place. This means that they have as much incentive to grow and sell tomatoes in the U.S. market as they did previously.
It is undoubtedly possible to construct a model with unusual supply assumptions that could lead to the sort of soaring prices described in the first sentence of the piece, but these would almost certainly be implausible. The Post piece tells us that the 85 percent price rise came from “analysis by economists at Arizona State University conducted in April.”
The Post article neglected to tell readers that the study, which does not appear to be available on the web, was commissioned by the Fresh Produce Association of the Americas.
While it is likely that this tariff will lead to a substantial increase in the price of tomatoes in the United States, and is probably a bad idea for many reasons, the Post should not be in the business in disguising industry propaganda and passing it along uncritically to readers. It seems this is acceptable in discussions of trade policy (unless the issue is protecting items like prescription drugs or doctors), but it is not good journalism.
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