President Donald Trump’s escalating trade war with Canada is creating headaches for Republicans ahead of November’s midterms as high prices remain a top concern among voters.

Responding to Trump’s increased tariffs, Canadian officials have said they’re deliberately targeting goods from states where there are close elections. And GOP candidates in Kansas, Maine and Ohio among others have been forced to balance supporting Trump with defending local manufacturers.

Trump has repeatedly targeted Canada, traditionally a close American ally, since returning to the White House last year. But his August move to impose 50% tariffs on billions of dollars of Canadian imports has heightened tensions, pushing Canada to retaliate with its own tariffs on hundreds of American-made products that went into effect Tuesday.

Nearly $28 billion in U.S. exports to Canada now carry up to 50% tariffs, a dollar-for-dollar match on Trump’s taxes on Canadian goods imposed last month, according to Canadian officials. 

Trump has long argued that Canada is taking advantage of the United States because of a longstanding trade deficit — meaning more Canadian products are imported here than American products are exported to Canada.

“They don’t pay for anything, and they want to be treated like a state, but they’re not a state,” Trump said last month after trade talks fell apart.

The fallout could affect consumers and businesses across the country, but Canada targeted many of its tariffs to inflict political pain just ahead of the crucial U.S. midterm elections that will determine control of Congress. 

The trade standoff has put Republican candidates in a tough position with an electorate already fed up with high prices and underscores ongoing concerns about how federal trade policy will affect American business and state economies.

On Labor Day, Trump threatened to halt sales of the Canadian airplane manufacturer Bombardier, saying its planes weren’t good enough and the company was treating America as a “piggybank.”

That became immediate political fodder in Kansas, home to Bombardier’s U.S. headquarters and competitive races for governor and U.S. Senate this year. The company employs more than 1,000 people in Wichita, the state’s most populous city that calls itself the “Air Capital of the World” with a local economy dominated by aerospace and aviation manufacturing. 

Trump’s trade war with Canada escalates as new tariffs launch

The state’s senior Republican U.S. Sen. Jerry Moran immediately defended Bombardier, as did Ty Masterson, the Republican nominee for governor and current state Senate president. But the issue has put pressure on the state’s junior Sen. Roger Marshall, a close Trump ally running for reelection in a competitive race. 

“We cannot allow this chaotic economic policy to continue to hurt Kansans; they deserve so much better. As your Senator, I will always stand up for Kansas workers,” the Democratic nominee in the race, Adam Hamilton, wrote on X Monday. 

On Tuesday, Marshall said he would fight to keep Bombardier’s jobs in Kansas, posting on social media, “I’ve already taken that concern inside the Oval Office.” Marshall said he agreed with Trump’s aim of bringing more manufacturing jobs, particularly in Bombardier’s case because the company sells half its products in the United States.

Tariffs on Canadian and American goods are poised to especially hurt Northern and Midwestern states, according to an analysis from Oxford Economics. It identified North Dakota, Montana, Michigan, Illinois and Vermont as the states most likely to be affected because they trade the most with Canada. 

Minnesota State Auditor Julie Blaha, a Democrat, said the trade feud is just the latest federal move to push up costs for businesses, consumers and local governments. Her office oversees some $56 billion in local government spending through financial integrity audits and budget analyses. She said Minnesota cities and townships have had no choice but to raise property taxes as they encounter rising prices.

“It’s just one wave after another. And it’s piling up,” she said. “All these rising costs are just coming home to roost, and they’re hitting Main Street.”

Minnesota shares a 547-mile border with Canada. Blaha said the state’s crucial agricultural industry is especially threatened as businesses constantly send products back and forth for processing. She highlighted General Mills, the maker of well-known cereals, including Cheerios. The firm buys Canadian grain that is processed in Minneapolis before being distributed to domestic cereal plants and sold across the U.S. and Canada. 

Grain is not on Canada’s list of targeted products for retaliatory tariffs, but the country did enact new tariffs on agricultural equipment, dairy and other food products. 

“These tariffs have a bigger impact than just one just one hit on a price,” she said. 

Canada’s political pressure

Canada’s retaliatory tariffs were aimed at pressuring the White House by targeting certain states and industries.

“We’re being wise and strategic to put political pressure,” Canada’s Industry Minister Mélanie Joly said last week. 

Canadian data show countermeasures will hit Ohio harder than any other state, the Canadian Broadcasting Corporation reported. Ohio is home to one of the most competitive Senate races this cycle as Republican Sen. Jon Husted defends his seat from former Democratic Sen. Sherrod Brown. 

Husted has largely defended Trump’s tariffs in the Senate. In an August interview with MS Now, he acknowledged the president’s decision-making was not in line with how he would negotiate, but declined to second guess Trump’s stance on Canada. 

Canadian tariffs to further raise prices, a top concern for voters

“It depends on how it ends,” the senator said. “If we get a good deal, both Canada and America can come out of this well, but it’s going to require both sides.”

Canada is Ohio’s biggest export market, sending $17.5 billion in goods across the border — roughly a third of the state’s total exports. More than half of the state’s exports to Canada come from the equipment and machinery and the transportation industries. Ohio is a leading producer of automobiles, an industry deeply affected by tariffs because of interconnected supply chains that span American, Canadian and Mexican factories. 

Trump’s tariff “decision is going to make it very difficult for folks in the automobile supply chain to be able to succeed in Ohio,” Rob Moore, principal at public policy firm Scioto Analysis, told the Ohio Capital Journal.

While Canada’s countermeasures were politically targeted, they will sweep across the country, affecting solidly conservative and liberal states. 

Connecticut State Treasurer Erick Russell, a Democrat, said the trade war will especially hurt New England states that trade more with Canada. He said the tariffs could raise prices of everything from electricity to consumer goods. 

Though tariffs will hit businesses and consumers first, Russell said they will eventually put more strain on local and state government budgets.

And the president’s on-and-off-again history with imposing and rescinding tariffs injects more uncertainty for both business and government, he said.

“Where things are right now, there isn’t any certainty or clarity around where this is ultimately going to land,” he said. “What is consistent through all of this is that consumers in Connecticut and all across the country are going to continue to pay for this tariff war.”

Concerns across New England states

The trade standoff could further hurt New England’s tourism industry that depends on steady Canadian traffic. 

In New Hampshire, Maine and Vermont, tourism is big business year-round as travelers flock to beaches in the summer, leaf peeping in the autumn and skiing in the winter. Those businesses have suffered a drop in Canadian visitors amid Trump’s ongoing aggression with the country.

Steve Wright, general manager of Jay Peak Resort in Vermont’s Green Mountains, recently assured Canadians that they were welcome to the resort that sits just a few miles from the border and a roughly two-hour drive from Montreal.

“The border may feel different right now,” Wright wrote online. “We do not. You are our neighbors. You are our friends. You are part of this place.” 

Vermont Republican Gov. Phil Scott recently characterized the president’s executive order to rename Lake Ontario to Lake America as “petty and disappointing.” Scott, who is favored in polls to win reelection in November, said the trade war harms communities on both sides of the border.

“Further escalating tensions does nothing to help American or Canadian families and businesses,” he added. 

In neighboring Maine, U.S. Sen. Susan Collins has criticized the tariffs and urged the administration to resolve its dispute with Canada. A Republican in a competitive race for reelection, Collins grew up just 20 miles from the Canadian border. 

Troy Jackson, her Democratic opponent, has blamed Collins for not stopping Trump’s trade policies. 

Last week, Collins told reporters that the White House viewed tariffs in a macro sense without appreciating how damaging they are to border states such as Maine. Collins said Trump’s tariffs were already hurting local governments that rely on Canada for imported salt to treat roads in winter and could further hurt the state’s crucial lumber and blueberry industries.

While Maine’s important lobster industry was spared retaliatory tariffs, Canada did impose 50% tariffs on wood products and agricultural products. 

“Canada is not China. It is not an adversarial nation,” Collins said. “It is our closest ally, our neighbor, our friend. And our economy is so intertwined with Canada that I am very worried about what the impact will be.”

Stateline reporter Kevin Hardy can be reached at khardy@stateline.org.

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• Free, simple tools can help people measure the change in inflation and see whether their pay is keeping up. 
• Experts Wisconsin Watch spoke to said that if your wage hasn’t changed and inflation rises, your real earnings decrease. 
• Workers can use inflation calculators to seek a raise if their real wages have dropped.

Inflation hit a three-year high in May, leaving a growing number of Americans struggling to afford necessities. The rate has since slowed a bit, but most prices aren’t likely to come down. Analysts say “affordability” could be one of the deciding issues in this fall’s midterm elections. 

But while we all notice the spike at the gas pump and the cash register, many people may not realize they can use simple, free tools to quantify the change and figure out whether their pay is keeping up.  

Wisconsin Watch talked to two experts about how and why to use inflation calculators. Here’s what they told us.

What is inflation and how do we measure it?

Inflation is a measure of how much prices have risen in a given period. Some increase in prices is to be expected — the Federal Reserve aims for 2% inflation when it sets interest rates. When prices rise quickly, consumers and businesses may struggle to buy what they need. 

The U.S. Bureau of Labor Statistics releases monthly inflation reports showing how prices have changed over the month and the year. The most widely used of those measures is the consumer price index, which shows the change in “prices paid by urban consumers for a market basket of consumer goods and services.” In other words, it’s the weighted average of the change in prices of many of the things American consumers buy. According to the bureau, this rate reflects the spending patterns of more than 90% of the U.S. population. 

The bureau also publishes a variety of more specific inflation rates, including for different geographic areas and for different types of expenditures, including food and beverages, housing and medical care. It also calculates a second version of its national inflation figure, called the Consumer Price Index for Urban Wage Earners and Clerical Workers, which is based on the spending patterns of households where at least half of the income comes from wage or clerical work. 

Meanwhile, the Fed keeps an eye on a related but different inflation measure, the Personal Consumption Expenditures Price Index, as it’s setting interest rates.

How high is inflation today?

The latest consumer price index numbers, released on July 14, indicate prices rose 3.5% over the last 12 months. The numbers also show prices fell 0.4% in June, when adjusted for seasonal changes. The drop over the month came from falling gas prices, though the average cost of a gallon of gas in the U.S. remains about $1.10 higher than it was before the war in Iran began, according to a price tracker from NBC News.

Inflation today is far lower than in 2022, when it hit 8%, the highest in more than 30 years. But 3.5% is still well above the 2% target, said Menzie Chinn, professor of public affairs and economics at the University of Wisconsin-Madison. 

“Inflation is not as big of a concern in terms of its absolute value as it was maybe four years ago, but it’s higher than we would want, and going forward we certainly don’t want inflation to be running at this pace,” Chinn said. 

Meanwhile, wage growth has slowed, falling behind price growth. Nationally, wages and salaries rose 3.4% between March 2025 and March 2026, according to the latest data from the Bureau of Labor Statistics.  

“Concern about prices rising is not just prices rising, but it’s against the backdrop of how fast wages are rising. How many people are keeping up, and what components of the population are keeping up?” Chinn said.

The inflation rate may eventually come down, meaning the rate at which prices are rising slows. And some individual prices, including gas prices, could come down too. But prices overall seldom fall. 

“The price level is probably never coming down, unless we have a severe downturn of some sort,” Chinn said.

What are inflation calculators and how do I use one?

Inflation calculators let you enter a dollar value and see how the buying power of that dollar value has changed over time. One easy way to understand this is to think about what a dollar could have bought 50 years ago. Today, that dollar is essentially worth less because you’d need more than a dollar to buy the same goods. An inflation calculator can show you exactly how big the change is: You’d need $5.88 today to buy what a dollar would buy in 1976,  according to the Bureau of Labor Statistics’ CPI Inflation Calculator.

For a more practical example, enter your wage or salary at the time of your last raise, indicate the month and year of that raise, then select the latest month for which data is available. That tells you how much that wage or salary is worth in today’s dollars. 

You can also do the calculation backward to see the contrast in a different way. For example, if you earn $50,000 and you last received a raise two years ago, your pay today only goes as far as $47,038.95 at the time of your last raise. In other words, your “real salary” has fallen by 5.9%.

“If your wage is stuck and inflation is going up, your real earnings are going down,” said University of Wisconsin-Milwaukee economics professor John Heywood, who directs the school’s graduate program in human resources and labor relations. 

You can also use these tools to check whether a given price has been rising faster or slower than inflation.  Say your rent was $900 a month in June 2024, and it rose exactly in line with the index for all prices. It would now be $956.65. If it’s risen more than that, it’s outpaced inflation.

Here are links to a few useful inflation calculators:

• U.S. Bureau of Labor Statistics’ CPI Inflation Calculator: bls.gov/data/inflation_calculator.htm
• Federal Reserve Bank of Minneapolis’ inflation calculator: minneapolisfed.org/about-us/monetary-policy/inflation-calculator 

How can I use the information I get from an inflation calculator?

Inflation calculations can be a helpful tool for workers seeking a raise. Heywood suggests workers seeking raises gather information on both how their real earnings have declined over time and how their earnings compare with those of people in comparable positions in the industry and geographic area, and present that data to their human resources department.

“My impression is that at large corporations and at corporations that sort of follow best practices, they don’t want their workers to be paid less than their rivals or have their earnings go down, because they’re always in a competition for keeping and retaining talent,” Heywood said.

“If you can show, for example, that your wage hasn’t kept up with inflation or with your comparables, then a sensible HR department says, ‘Here’s somebody we might lose,’ and might very well be willing to increase somebody’s hourly or salary rate,” he said. 

If you’re represented by a labor union, your union representatives are likely doing these kinds of calculations regularly.

“It’s part of making sure that their members don’t have their earnings eroded by inflation,” Heywood said. 

To hold workers’ buying power steady, Heywood said, many union contracts include automatic cost of living adjustments. Six months into the contract period, for example, workers’ wages will rise by the same percentage that prices rose during those six months. 

Clauses like those were far more common before the soaring inflation of the 1970s and 1980s, Chinn said, noting that raising wages automatically in response to inflation can sometimes make inflation worse. As economists battled to get prices under control in the 1980s, they became more skeptical of these automatic wage increases.

“It’s good for the workers, it protects their buying power, but that means the cost of making stuff rises … which then feeds into next year’s demands,” Chinn said. Thus even a temporary shock to the economy can last much longer. 

But not raising pay comes at a cost too. “If they don’t get that automatic adjustment, it’s more likely they won’t get to maintain the real wage,” Chinn said.

Automatic cost of living adjustments are still common in some industries. “The auto industry uses it, (along with) aerospace, defense, postal workers, letter carriers, and a lot of local public unions,” Heywood said. “It hasn’t gone away.”

What’s the inflation forecast?

Many economists are predicting 2.5% to 3% inflation over the next year, Chinn said. He thinks those predictions are probably about right. 

“That’s assuming that we’re not having a big resumption of the war with Iran that completely blocks off indefinitely the Strait of Hormuz,” Chinn said. “That assumes no big collapse in the stock market and no big jumps in a trade war going forward.”

Natalie Yahr reports on pathways to success statewide for Wisconsin Watch, working in partnership with Open Campus. Email her at nyahr@wisconsinwatch.org.

With prices up, here’s how and why to use an inflation calculator is a post from Wisconsin Watch, a non-profit investigative news site covering Wisconsin since 2009. Please consider making a contribution to support our journalism.

WASHINGTON — President Donald Trump reignited his tariff agenda Friday by imposing new import taxes on products from dozens of top U.S. trading partners, immediately replacing temporary global tariffs he levied after the U.S. Supreme Court delivered a major blow to his sweeping “Liberation Day” duties.

As of Friday morning, American importers will now pay an extra 10% to 12.5% of a product’s value on most goods from nearly 60 countries, including Canada, the European Union, Japan, Mexico, South Korea, Taiwan and the United Kingdom, among dozens more. The tariffs could affect 99.4% of imports, according to U.S. trade authorities.

The fresh round of import taxes, first announced late Thursday afternoon, replace a blanket 10% tariff on global goods under Section 122 of the Trade Act of 1974, which expired at midnight Friday. Those tariffs invited new legal challenges, including from Democratic-led states.

The latest tariffs were imposed after the Office of the United States Trade Representative allegedly found forced labor conditions in all of the economies investigated under Section 301 of the Trade Act of 1974.

U.S. Trade Ambassador Jamieson Greer said in a statement Thursday that Trump “recognizes that decades of moral suasion have not eradicated forced labor from global supply chains.  The United States has had a forced labor import ban for nearly a century, and rigorously enforces it; it’s well past time for our trading partners to do the same.”

Supreme Court ruling

The Office of the United States Trade Representative announced two broad investigations in March, less than one month after the Supreme Court struck down Trump’s unprecedented global tariffs under the 1977 International Emergency Economic Powers Act, commonly called IEEPA. 

Shortly after the Supreme Court’s blow to his IEEPA tariffs, which he announced in early April 2025 on what he dubbed “Liberation Day,” the government was on the hook for roughly $166 billion in refunds to American importers who already paid the duties.

The latest batch of duties, in effect as of Friday, is the second round of import taxes the Trump administration announced this week. The White House introduced 50% tariffs on most Canadian imports Monday, triggering the duties under Section 338 of the Tariff Act of 1930.

The Depression-era provision, which has never before been enforced, authorizes the president to impose duties up to 50% of a product’s value in response to discrimination against U.S. commerce.

States Newsroom has spoken with numerous small business owners since 2025 about the effects tariffs have on their capacity to keep prices steady, hire employees, invest in new equipment and inventory, and just generally remain in operation.

‘Ridiculously blunt’

Critics slammed the administration’s new series of sweeping duties on a large swath of the country’s imports.

Scott Lincicome, vice president for general economics at the libertarian Cato Institute, wrote Thursday the outcome of the Section 301 investigations were “clearly predetermined” and “both ridiculously blunt and wildly out of proportion to any measurable economic distortion.”

“And the whole thing establishes precedent for an ‘automatic tariff generator’ that Trump or a future president can deploy at will. It makes a mockery of a real issue and might poison legitimate reform. And Congress probably won’t do anything about it,” Lincicome wrote.

Some Republicans in the U.S. House rebuffed Trump’s tariff agenda in February, but legislative change has not emerged. 

Senate Minority Leader Chuck Schumer said in a statement Thursday the president has “has bled the inflation-battered American people dry with his tariffs.”

“Now he’s coming back for more. Trump’s chaotic tariff taxes have made life harder and more expensive for the American people. Families are paying more for everyday necessities. Small business owners are struggling to keep the lights on. Manufacturers are shedding jobs and farmers are getting squeezed. Meanwhile, Trump and his billionaire family and friends get richer on the backs of working families,” Schumer, D-N.Y., said.

The Yale Budget Lab estimates consumer prices could rise up to 1% under the new tariffs, increasing household costs by roughly $1,100.

If the duties remained in place, the U.S. would gain about $2 trillion in revenue over the next decade, though the number would likely be lower after accounting for negative impacts on the economy, according to the Yale Budget Lab.

WASHINGTON — Federal Reserve Chair Kevin Warsh promised Tuesday to “put these years of high inflation behind us” and lower prices, including mortgage rates, for everyday Americans as inflation remains at the highest level in two years.

Warsh appeared before lawmakers on Capitol Hill just after the government’s latest monthly inflation data showed a slight drop, led by falling gas prices as the war in Iran cooled. 

But routine costs like food and fuel remain 3.5% higher compared to a year ago, a level of inflation last seen in May 2024, according to the Bureau of Labor Statistics’ Consumer Price Index for June. The report comes as the United States and Iran again ramped up the exchange of rocket fire last week in the Strait of Hormuz, a chokepoint for a significant portion of global oil.

The grilling by members of the House Committee on Financial Services marked Warsh’s first time before Congress since being confirmed to lead the central bank. 

The nation’s top banker faced questions not only about inflation, but also how he plans to insulate the Fed from President Donald Trump, following the U.S. Supreme Court’s decision to increase the president’s authority over agencies.

Warsh told lawmakers he will ignore political pressure and “follow the data” when deciding monetary policy decisions.

Warsh’s appointment was made after Trump’s long and public pressure campaign on former Fed Chair Jerome Powell to lower interest rates, and his firing of Fed Board Governor Lisa Cook. Trump also targeted Powell with a federal investigation over renovation costs, but eventually dropped the probe.

‘A potential second surge in inflation’

Financial Services Committee Chair French Hill, an Arkansas Republican, warned during questioning “a potential second surge in inflation is appearing due to factors outside the Fed. What the Fed can control is how it reacts.”

Hill said he was “encouraged” to hear Warsh commit to lowering inflation to the Fed’s target of 2%.

“Inflation affects Americans in the here and now, not in some hypothetical future composed of long-term projections. … How do you and your colleagues on the open market committee plan to accomplish that?”

Warsh said the Fed will examine interest rates and the central bank’s assets and liabilities to harness inflation.

“We have the tools to deliver that. So it’s a function of commitment, responsibility, and tools, and we’re three for three, and we’ll deliver,” he said.

Hammering on the topic of high costs of living, Rep. William Timmons, R-S.C., said “the people I represent should not have to endure another sustained period of elevated inflation.”

Warsh said he agreed with Timmons’ “diagnosis” that American households and businesses have suffered an “undue hardship.”

“What I would also say is I’m not in the business of trying to prejudge what the (Federal Open Market) committee I’m honored to lead decides,” Warsh said. “I think we need to have a continued good family fight on this subject. That’ll start again in a couple of weeks, and when we have news for you about exactly the methods of solving this problem, we’ll be very clear about what they are and so will the American people.”

Communications with public

Several questions from committee Democrats centered on how Warsh plans to communicate with the public after he announced plans to pare back press conferences and announcements. 

Rep. Nydia Velázquez, D-N.Y., asked Warsh if he can “commit today to creating a fixed public standard for which (Federal Open Market Committee) decisions and procedural changes trigger a press conference rather than deciding case by case which ones might be worth it?”

Warsh said it is “immediately important to think about reforms, including communications.”

“I don’t expect any of the changing communications to be about hiding the ball,” he said.

Rep. Andy Barr, a Kentucky Republican, cited a Wall Street Journal article criticizing the “constant yammering, long policy statements and press conferences” to signal future policy moves.

“Chairman Warsh, why is it important to do away with the dot plot and end once and for all forward guidance?” Barr asked, referring to a graph displaying data as dots.

Warsh said his Fed will not share “every passing thought.”

“I think being somewhat more circumspect in our communications, at least for me, is a better way of calling balls and strikes,” he said.

Will he ‘follow the president’s wishes’?

Warsh also faced numerous questions from Democrats on his commitment to protecting the Fed from Trump’s attempts to interfere.

Rep. Gregory Meeks, a New York Democrat, said “If the president publicly pressures you to pursue a different course than the one you believe the economic data supports, will you follow the president’s wishes or follow the data?”

“My commitment to you is to follow the law and follow the data, follow our very best judgment,” Warsh answered.

Meeks shot back: “Even if he publicly criticizes you for doing it? … Publicly criticizes you and tells you how disappointed he’s in you and all of that? Will you still do what the data tells you to do? … You ready for that?”

“I’m ready to follow the law, and I’m ready for the Fed to deliver on the expansive remit that you gave us,” Warsh replied.