The economic hit will come in the form of higher prices not only of imported goods, but also their domestically produced equivalents, which can command a higher price due to diminished competition. Another impact will be the reduced availability of goods not produced in the United States (think avocados from Mexico). The Congressional Budget Office, as well as nonpartisan organizations such as the Peterson Institute for International Economics have done studies of the economic impacts that these tariffs would have: inflation, fewer jobs, and reduced GDP.
Trump states that tariffs are paid by foreign governments, but this is untrue. Canadian government agencies or companies do not pay the United States for the privilege of being able to sell their products here. Tariffs are paid to the U.S. government by companies that import goods, and they recover the costs by passing them along to customers. Consumers will therefore see price increases in places such as grocery stores (the US imports numerous agricultural products from Mexico and Canada), the gas pump (the largest supplier of foreign oil to the US is Canada, followed by Mexico), and car dealerships (automobile production is highly integrated across the both the northern and southern borders).
American tariffs will also harm our trading partners, putting people out of work and wreaking havoc on their economies as Americans reduce their purchases of Canadian and Mexican goods. These countries will also impose retaliatory tariffs, probably with some strategically placed on goods from states that voted for Trump: Florida citrus, steel from Pennsylvania, corn from the Midwest, Kentucky bourbon. American producers will see their sales to Canadian and Mexican customers drop considerably. The result will be a loss of income, jobs, and investment in industries all across the United States….