Day: April 12, 2025

The impact that President Trump’s tariffs, whatever form they take, will have on U.S. manufacturing is unknown, and likely will be for several years. Hopefully, they will be the impetus for the manufacturing renaissance that the Trump Administration is banking on. But, one sure way to immediately boost our manufacturing base would be to reduce the cost of two inputs that are key to all manufacturers. No matter if your widget of choice is a sophisticated automobile or something as humble as a paper clip, all manufactured goods use both energy and transportation.

With the Trump Administration’s “drill baby drill” mantra, much is already being done to lower energy costs. Thus far the other half of the equation, transportation, has not gotten much attention. This is unfortunate. In 2023 American businesses spent over $1.5 trillion on the transportation component of the logistics equation alone – over 5% of GDP. When you purchase lettuce at a supermarket, a sweater through an online service or a bottle of Bourbon at a liquor store you are buying transportation. Transportation is an embedded purchase that no one really cares about. Except that it is an expense. Anything that can be done to reduce business expenses will make American manufacturers more competitive.