The Impact of the Tariffs on Technology Under the Trump Administratio
By: Edison Lin
During the 2024 election, the two candidates running for the presidency were Kamala Harris and Donald Trump. Millions of Americans waited for election day as both presidential candidates held rallies, participated in debates, and used the media to get people’s attention. Many Americans who were supporters of Trump in 2016 were excited as former President Donald J. Trump sought to return to office after his defeat in 2020. The 2024 election was one of the most intense and high-stakes elections, as the different political ideas polarized the country.
The campaign was highly intense because both candidates presented opposite viewpoints and ideas for the future of the United States. Harris, representing the Democratic party, focused on continuing what Biden has done throughout his presidency, which includes expanding healthcare access, addressing climate change, and promoting economic recovery. On the other hand, Trump, a Republican, promised to return prices back to normal when he was president, lower taxes, and reinforce immigration policies.
As election night came closer, the results began to settle. By the morning of November 6, 2024, Donald Trump had surpassed the 270 electoral votes that are required to win the presidency. The final electoral votes were 312 for Donald Trump and 226 for Kamala Harris. This victory made Donald Trump the official president-elect, making this a return to the White House after being gone from office for four years.
In the aftermath of this election, people are starting to see drastic economic changes heading toward the future of America. Under the Trump Administration, one of the policies, specifically targeted toward trade and the economy, was to increase foreign imports by a 10% tariff to help boost the American economy. This is intended to retaliate against the other countries who have put tariffs on us. This will make companies within the US move their manufacturing factories to the US so there would be jobs
opened and more taxes for the government. According to NBC News, they said, “Trump has said the most recent tariffs are a form of retaliation against countries that put their own tariffs on U.S. goods. He has said the so-called retaliatory tariffs will give companies incentives to move manufacturing to the United States by punishing companies that produce their products overseas.” This may sound good to many people who are looking forward to seeing American businesses expand, but there are significant consequences that come along with this, particularly in technology.
The United States has big tech companies like Apple, Meta, Nvidia, and Microsoft. The explanation is that the majority of semiconductor companies are located around Asia, particularly in Taiwan, Japan, China, and South Korea. Taiwan, for example, is home to the world’s largest and most advanced semiconductor factory (TSMC). For instance, an article called A Preview Of Taiwan Semiconductor’s Earnings says, “Taiwan Semiconductor Manufacturing Co. is the world's largest dedicated chip foundry, with over 60% market share.” These chips are crucial for companies like Apple & NVIDIA, and they rely heavily on them. For example, Apple’s iPhones, MacBooks, and iPads use chips that are designed by Apple but are manufactured at companies like TSMC in Taiwan. Similarly, Nvidia, a massive tech company that sells graphics processing units (GPUs), depends on chips produced overseas. These chips are highly specialized and require advanced manufacturing capabilities that are not yet available in the United States. Even if the US can manufacture these advanced chips, the labor within the United States would be costly; therefore, hiring labor outside of the country is cheaper, as there are fewer regulations on labor laws.
Therefore, while the US has good tech companies, most of the chips are imported from overseas in countries like Japan & Taiwan. If tariffs are to be imposed on these imports by the Trump Administration, it could lead to higher-tech costs for US tech companies that depend on these chips made overseas. These companies may face higher production costs as these chips will be more expensive leading to the consumers needing to spend more for products like a smartphone, laptop, or even gaming consoles. For example, iPhones are expected to soar $2000 per phone from the usual $1000. According to a report from CNBC, Xbox Series S with 512GB of storage costs $379.99 in the U.S. as of May 1, up from $299.99. The Xbox Series X will go for $599.99 instead of $499.99. Meanwhile, the price of the special edition of the Xbox Wireless Controller will increase $10 to $79.99.
To sum it all up, while the US has strong tech companies, they still rely relatively heavily on the countries producing these semiconductor chips, specifically in Asia. These tariffs on imports from other countries could result in higher prices and potential delays in production, which would basically do more harm than good, as phones are used quite often in everyone's day-to-day lives.