Regular readers have noticed my recent obsession with our current tariff and trade issues. For a column that normally focuses on state politics, it’s a bit of a divergence.  And yet, it ultimately ties in with what we do here with both our politics and our livelihood.

Let’s start with the easiest example, which is our ports. The Port of Savannah is rare in that it roughly balances import and export activity.  

This matters because much of the dialogue around the trade issue is how we’re getting “ripped off” from other countries that don’t buy our products.  Much of what we sell to the rest of the world that leaves from Georgia’s coast is food or forest products, but we also export an increasing number of manufactured goods. 

Cars made in Georgia and throughout the southeast leave to other nations from Brunswick and Savannah.  In fact, Brunswick led the nation in “RoRo” – roll on, roll off – exports last year.

It’s cringeworthy to continue to hear that “we don’t make things here anymore”.  We do, and we deliver them from our ports.  But the story goes deeper than that.

Upstream – via the supply chains rather than navigable waterways – those goods being exported are grown, harvested, and or manufactured in Georgia or nearby states.  We, in the South and specifically in Georgia, are producing more not less. 

Anyone paying attention to the economic policies of Governor Brian Kemp has seen the results.  If you don’t follow policy, you need only drive Interstate 16 from Macon to Savannah.  Not only will you see a new expansive Hyundai plant, but some of the dozens of suppliers who are locating here based on the announcement of that plant and the related Kia facility in West Point can easily be seen in that corridor. 

Georgia is fully invested in a domestic manufacturing base, with a continued emphasis on our agricultural and forest products sector.  Both mean jobs, economic stability, and quality of life for millions of Georgians.  

Thus, the stakes are quite high with our current trade negotiations. Many Georgia businesses have been drafted to the front lines in a hastily declared trade war.  We may or may not be “holding all the cards” as the President has claimed, but the chips on the table are the investments made by businesses, farmers, and timber land holders, as well as each employee who works in those fields, and the next order of businesses in each community.  That’s…almost all of us.

Certainly, there is potential upside.  More exports and more trade means even more jobs and economic value created for Georgians.  In the interim, we’re stuck with uncertainty, unclear goals, a vague timeline, and factions within the White House economic team arguing in private and contradicting each other in public.

The unease this is causing extends far beyond the kitchen tables of Georgians trying to figure out their economic futures. International financial markets are fleeing dollar denominated assets.  This includes our currency, our bonds, and even oil.  

Normally in times of economic uncertainty investors around the globe would buy US treasuries in a flight to safety, which pushes down interest rates.  The opposite is happening now.  The  “long end” of the yield curve – interest rates set by the international markets’ willingness to take risk over time – is pricing higher and higher rates the longer this level of tariff and trade uncertainty continues.

At this point it doesn’t appear any permanent damage has been done. Yet a lot of warning signs are flashing.

We’re already going to see short term disruptions. China has suspended a lot of purchases of U.S. agriculture products. Many producers of cars built in Mexico and Europe have at suspended shipments of new automobiles to the US pending the outcome of negotiations. 

As we learned five years ago when we  abruptly shut down the world wide economy, restarting supply chains once disrupted is a lot more complicated and messier than just flipping a switch.  

There will already be ripple effects.  Firm and clear actions and decisions must be made to keep them from becoming waves.

Georgians have a lot at stake in the outcome of these negotiations and our future trade policies. This would normally be where I would counsel that we take our time and get it right.  

Instead, the markets need certainty more than they need the “right” answer. Markets will correct around decisions once they appear clear, certain, and final.  Until those conditions are met, we’ll remain in limbo with the warning signs begging to be noticed.