King Don wages his trade war on the pretext that tariffs will boost American manufacturing. But as usual, the Wharton wimp gets economics wrong. Tariffs have pushed American combiner Claas to shift production away from Omaha to Germany:
Anticipating the tariffs that would come, Claas last spring tried to get in front of the situation in North America by pushing its Omaha plant to produce extra of the Lexion combines, even pushing its Nebraska workforce into overtime to do it. The goal was to oversupply its Canadian dealerships before tariffs went into effect between the United States and Canada.
The fear was any Claas equipment built in the United States and shipped elsewhere would stand to be hit twice by tariffs. Between 60% and 70% of the components of a Lexion combine built in Omaha are sourced from outside the United States, meaning all that hardware would be subject to tariffs, including a 50% tariff on steel.
Then, once the United States established tariffs on Canada, the reciprocal Canadian tariffs on U.S. goods meant anything shipping north from the United States would be dinged again.
Those combines built in the spring in Omaha lasted through the fall harvest in Canada, plus a little extra. But to provide an answer going forward, Claas has opted to fill orders from Canada with its factories in Germany rather than Omaha.
“The combines made for Canada, most of them will be made in Germany and shipped directly to Canada instead of out of our Omaha plant,” Schofield said. “Some of the production will be moved to Germany just because we incur a tariff to move parts into the United States, and then because it’s moving from the U.S. to Canada, which has a reciprocal tariff. It hits that machine again, so temporarily, we’ll be changing that” [Joel Reichenberger, “Claas Continues to Pivot in US Market,” Progressive Farmer, 2025.11.25].
Come 2028, we’d better elect Robert Reich or some other real economist to the White House. We’ll need real economic intelligence and experience to fix all the damage Con Man Don is doing to our economy.