This Illinois town aims for economic revival – but will Trump tariffs help?
| Belvidere, Ill.
Belvidere, Illinois, is the kind of comeback community that President Donald Trump envisions for Middle America.
It’s a blue-collar Midwestern town that builds things. Less educated and poorer than the national average, it’s the kind of place President Trump hopes to rescue with tariffs intended to bring manufacturing back to the United States. But Belvidere is roaring back because of its own pluck. And those tariffs, meant to help Middle America, may cause more harm than good for this conservative city of 25,000, at least for the short term.
It’s a reminder that on the ground, economic reality doesn’t always conform to government plans and that international trade restrictions cast a long shadow.
Why We Wrote This
President Donald Trump’s tariffs aim to revive U.S. manufacturing and the cities where it happens. But in Belvidere, Illinois, the reality is complicated.
Over lunch at the Steam Plant Family Restaurant, Mayor Clint Morris is optimistic. “The tariffs are really incentives to bring these jobs back to this country,” he says. “In the long run, I think they’ll be good ... [but] there’s going to be some growing pains.”
Pamela Lopez-Fettes isn’t so sure about the wisdom of tariffs. “The price is going to go up for the end user,” says the CEO of Growth Dimensions Economic Development, a nonprofit organization for Boone County. “We know that this is hitting farming. This is hitting manufacturing.”
While tariffs may raise costs for local businesses that buy Asian steel and Canadian oats, they may help protect others from foreign competition, she adds, and it’s not yet clear whether any trade deals that Mr. Trump makes will prove to be a net positive. What is clear is that the disruption surrounding tariffs has caused a lingering uncertainty.
At first glance, Belvidere would seem well insulated from the impact of tariffs. Downtown, Victor Hernandez is getting ready for the dinner crowd at his restaurant, El Molcajete.
“It’s definitely looking up,” he says of the local economy. “The population is growing.” And the prospect of the local Stellantis auto assembly plant reopening in a couple of years means good times ahead, he adds. So far, tariffs have not hit the restaurant’s food budget very much.
Across the street, the Boost Mobile phone shop hasn’t seen any impact, either. But the trade war with China has weighed on business. “We’re aware of it,” says Athziri Islas, a sales representative, and sales haven’t exactly been brisk. “People have been holding on to their money,” she adds.
If the latest ceasefire in the U.S.-China trade war holds, iPhone prices won’t be doubling. Still, they might cost about 30% more.
Such changes matter for Belvidere residents, especially its large, low-income Hispanic population.
Lessons for the rest of America
If one lesson is that tariffs aren’t a simple fix for economic development, Belvidere offers other lessons for American communities hoping for a rebound.
Success breeds success, says Mayor Morris, a major force behind Belvidere’s still-emerging revival. Once General Mills committed to building a distribution facility in the city, it was easier to convince other companies to do the same.
Rebounds also take time, says Art Wheaton, director of labor studies at Cornell University’s School of Industrial and Labor Relations. The Stellantis facility, with an existing plant and workforce, will have taken four years before Ram pickups start rolling off the assembly line in 2027, he points out. New plants take even longer.
And communities that succeed are not returning to their nostalgic pasts. They’re reinventing themselves to fit an ever-evolving economy that is increasingly automated. When Stellantis reopens, it will provide 1,500 union jobs – a fraction of the peak employment in the plant’s heyday, says Mayor Morris.
Walmart, one of the city’s newcomers, is due to open in 2027 a new cold-storage facility that will be one of its first automated distribution centers. Some 400 to 700 employees will deliver frozen food, eggs, dairy, fresh produce, and even flowers to area Walmart stores at twice the capacity and double the speed of its traditional distribution centers.
General Mills’ new facility is its first primarily automated distribution center. It employs only about 70 workers who load and unload inventory and service the machines that store and retrieve it.
Behind this city’s gradual revival
Belvidere’s turnaround preceded the Trump administration. It was led by local people who didn’t give up on their community when its major employer, the Stellantis plant, was idled in early 2023. And it was aided by the United Auto Workers, who negotiated a national contract with Stellantis that included a promise to reopen the plant.
Even before the Stellantis announcement, Mayor Morris was pushing to diversify the local economy beyond autos. He helped convince General Mills, Walmart, and Midwest Refrigerated to locate storage and distribution centers in town. Although these bigger businesses mostly deal with domestic products, they also worry about tariffs.
With two-thirds of Walmart’s products made domestically, CEO Doug McMillon nevertheless said in a statement last week that it had already raised some prices and would raise more “given the magnitude of the tariffs.”
It’s unclear whether Netherlands-based Stellantis will benefit from the Trump administration’s tariffs. Its North American operations, formerly Chrysler, might benefit from the 25% duty on imported cars and parts. But its French and Italian brands could be hit hard. In any case, the transition may prove rough. “In the United States, the car industry is severely affected by tariffs,” its chairman, John Elkann, said in a speech last month. “On top of the 25% tariff imposed on vehicles, we are impacted by layer upon layer of additional compounding tariffs including those on aluminum, steel, and parts.”
Rival automaker Ford says the tariffs will cost the company $1 billion, even after adjustments. Earlier this month, it raised prices on some of its Mexican-produced cars by up to $2,000. General Motors has pegged its tariff tab at $2.8-3.5 billion, after adjustments, and has trimmed by a fifth its estimated profits for the year.
Editor's note: This story was updated May 19, the same day as publication, to correct spellings for Doug McMillon and El Molcajete restaurant.
