Why Kentucky business, political leaders are worried about Trump’s new wave of tariffs
President Donald Trump unveiled a new set of tariffs on foreign goods Wednesday, promising the new tariff plan would pump billions into the economy, correct unfair trade practices and possibly bring more manufacturing back to the United States.
The Trump administration has said a previously announced 25% tariff on foreign automobiles would take effect midnight Wednesday, and he announced steep tariff increases on goods coming from certain countries including China, the European Union, Japan and Vietnam.
All foreign imports will see a base 10% increase, Trump said during a Rose Garden news conference.
Ahead of Wednesday’s announcement, many of the United States’ trade allies have said they will institute retaliatory tariffs, further driving up costs on an assortment of goods and products.
Wednesday’s announcement comes after Trump has already announced additional tariffs on goods from Mexico and Canada. Some of those tariffs have since been delayed.
Many Kentucky business and elected leaders — Republicans and Democrats —are concerned if the tariffs stick, it will hurt Kentucky businesses and consumers alike.
Kentucky Republican Sens. Rand Paul and Mitch McConnell have criticized Trump’s tariff plans. Both drew the president’s ire on Tuesday after they signed on to a Democratic-backed bill that would end Trump’s tariffs on Canada.
Republican Sens. Susan Collins of Maine and Lisa Murkowski of Alaska also have signed on to the bill, which now goes to the US House.
A vote on the bill that would end a state of emergency that allowed Trump to set the Canada tariffs later Wednesday.
Trump, on Truth Social on Tuesday, said the senators were aiding the movement of fentanyl across the Canadian border and “are playing with the lives of the American people, and right into the hands of the Radical Left Democrats and Drug Cartels.”
Paul has said tariffs are taxes that are passed on to consumers.
“Tariff wars hurt home builders, real estate brokers, bourbon sellers, farmers, carmakers, shippers, purchasers of steel, etc. Growth in international trade is proportional to growth in GDP. A fact. If you cripple trade, you will ultimately cripple GDP. Not a good thing,” Paul said in a March 17 post on X.
McConnell, in a February opinion piece in the Louisville Courier-Journal, said he also thought more tariffs meant higher prices. Tariffs hurt Kentucky’s agricultural, bourbon and automotive sectors, he wrote.
“Blanket tariffs make it more expensive to do business in America, driving up costs for consumers across the board. These aren’t just abstract concerns. Broad-based tariffs could have long-term consequences right in our backyard.,” he said.
“Consider our state’s 75,000 family farms that sell their crops around the globe, or the hardworking Kentuckians who craft 95% of the world’s bourbon, or our auto industry that relies on global supply chains to support the livelihoods of thousands of workers in the commonwealth.”
Gov. Andy Beshear, a Democrat, has sided with McConnell and Paul. Beshear said he is worried about prices going up at a time when few Americans can afford it.
“It’s going to cause our prices of gas to go up; it’s going to cause our prices of groceries to go up. It’s going to raise the cost of housing all across the United States. In every one of those instances the amount of those increase in costs should be called the Trump tax,” Beshear said in an interview with CTV News in early March shortly after Trump’s announcement of tariffs on Canada and Mexico.
Rep. Andy Barr, R-Lexington, has supported Trump, his cuts and his tariff plan. The Lexington Republican, during a March 20 speech in Lexington, said Trump’s proposed tariffs will translate into wins for Kentucky businesses.
He has signaled he wants to replace McConnell after the Louisville Republican announced he was stepping down in 2026.
“I understand that tariffs in the short-term create some uncertainty,” Barr said in comments after his speech. “But in the long-term, this is the right policy because it has the enormous potential to open up markets to our exporters and provide a level playing field for American businesses,”
Kentucky business leaders also weary of more tariffs
“As a rural, manufacturing state, we have great concern on what these tariffs mean for our auto manufacturers, distillers and farmers,” Watts said. “As this issue progresses, the Chamber will continue to work closely with our members and our Congressional delegation to assess the impact and advocate for policies that protect our economy.”
Bob Quick, the president and CEO of Commerce Lexington, said the Lexington-area business chamber supports open markets and deregulation, but he is also concerned about the immediate effects on Kentucky businesses.
“Commerce Lexington supports open-trade policies with markets abroad and removing barriers that shut U.S. exports out of foreign markets. We also support efforts to implement fewer federal regulations and less taxation to grow our economy,” Quick said.
“However, we remain concerned about the potential negative economic impact of tariff policies on key industries in the Greater Lexington Region, including agriculture, advanced manufacturing, and bourbon. Commerce Lexington will continue to monitor these issues, talk with business leaders about impacts and communicate concerns to federal officials.”
