President Donald Trump’s aluminum tariff won’t make beer taste better, but it’s succeeded in boosting the economy, according to a report published Tuesday by the Economic Policy Institute.
The research, from the left-leaning think tank, argues that tariffs imposed on aluminum and steel have led to increases in U.S. employment, production and investment.
The Beer Institute, a trade association for the American brewing industry, called tariffs on aluminum a “tax on beer,” saying that cans make up more than 11 percent of the manufacturing cost in the U.S.
“We’ve seen a 5 to 10 percent increase in our costs despite our aluminum being sourced domestically,” said Ryan Krill, co-founder of the Cape May Brewing Co. in New Jersey. “We’ve estimated the total cost increase will be $30,000 next year. I appreciate what the Trump administration is trying to do, but there’s been unintended consequences.”
The EPI says benefits have outweighed negatives.
Beer industry claims of harm from the aluminum tariff were in “downstream distribution sectors,” according to the EPI report, “with 91 percent of the 20,300 jobs lost in ‘retailing, supplier and induced’ segments.” Changing tastes have more to do with any decline in beer’s popularity than a 10 percent tariff on aluminum, it said.
U.S. beer sales by volume fell 1.2 percent in 2017, according to the Brewers Association.
Richard Trumka, head of the AFL-CIO, is chairman of EPI’s board of directors.