AMNA NAWAZ: President Trump is dialing up the pressure on a number of countries in pursuit of better trade deals as his new August 1 deadline closes in.

Two countries are facing particularly serious threats.

Brazil would face tariffs as high as 50 percent and Canada could face 35 percent on many products.

Companies are trying to navigate rising prices once again.

William Brangham talks to one executive who's trying to figure it out.

WILLIAM BRANGHAM: That's right, Amna.

The president also threatened yesterday to raise even the baseline tariffs that most countries pay higher to either 15 or 20 percent.

In a phone interview yesterday, the president also dismissed a warning from Hasbro's CEO that toy prices will rise if the U.S. continues to hike tariffs.

We take a look at the impact of all of this with another key toy manufacturer.

Jay Foreman is the CEO of Basic Fun!, which sells toys like Tonka Trucks, Care Bears, and Lite-Brite.

Jay Foreman, thank you so much for being here.

Most of your products are manufactured in China.

Imports on Chinese products at one point were 145 percent.

They are now down to, I believe it's 30 percent.

How has that affected your operations?

JAY FOREMAN, CEO, Basic Fun!

: Well, it's - - we have been affected on a number of different levels.

Initially, we were affected just from the fact that at 145 percent, it was a de facto embargo, so we stopped producing and stopped shipping.

Now that the tariffs have come down to about 30 percent, the flow of goods is happening, and it's just a question of, where is the tariff going to be absorbed?

It's not just by toy makers.

It's by any importers in any industry.

So, typically, what you're seeing and what we're seeing and experiencing is a shared impact, where we are absorbing a bit of it, the retailer is absorbing a bit of it, and some of it is being passed along to the consumer.

You're not feeling it, and the consumer is not feeling it today, but most likely in the last four months of the year, September, October, November, for sure there is a price to pay.

Now, if it's not in higher prices and categories, it's likely in lower profits or lower sales for corporations.

Nothing is free.

Tariffs aren't free.

They don't come at zero cost.

Somebody pays the cost.

We're just going to find out in the fourth quarter who is going to end up paying that cost.

WILLIAM BRANGHAM: I mean, given that volatility and uncertainty, have you moved any of your production elsewhere because of these?

JAY FOREMAN: Well, we have been countersourcing our products not only in China, which is our main source of production, but also in Vietnam and in Indonesia.

And what we have found is that the production costs in those countries are actually higher than China.

So even if the tariffs are a little bit lower or the same, it's not cost-effective necessarily to move out of China.

And, of course, we do produce some of our toys in the U.S. We produce our Connect building sets and our Lincoln Logs in the U.S.

But ramping up production in the U.S. for lots of the other types of toys we make is just a little bit challenging, based on the availability of labor, but also the time it takes to set up new factories and potentially the additional costs that you would have to incur to manufacture here, as opposed to a foreign country.

So far, we have left the majority of our production in China for now.

We are looking for alternate sources.

WILLIAM BRANGHAM: Because that -- what you just mentioned is something that is part of what the president says is his motivation, which is raise tariffs on other countries so that U.S. manufacturing is grown and returns to this country.

Could you foresee a future where you do more manufacturing here in the U.S.?

JAY FOREMAN: Well, the toy industry is looking to find ways to bring production back to the U.S.

But I bet if you asked an A.I.

chatbot, how many workers would it take to replace the amount of workers that are employed in the imports of products that we use here, it's probably like 60 or 70 million people are involved in manufacturing imported goods.

We have only got 13 million people today in the manufacturing of goods.

So we need another 60 million people producing everything from T-shirts and teddy bears to telephones and telescopes here in the United States.

So the fact is that we don't necessarily have the work force to produce all these goods here.

So the question is, should we be producing the right type of goods here, strategic goods, important merchandise that we need to tighten up or control supply chains?

I would say yes.

T-shirts, teddy bears, tennis rackets, maybe not.

WILLIAM BRANGHAM: You mentioned that you had not yet raised prices for consumers here in the U.S. because of these tariffs.

How much longer do you think you can hold out without raising prices to keep your bottom line intact?

JAY FOREMAN: Well, there's no way to keep the bottom line intact.

So if we're not raising prices, that means we're making less profit.

What less profit means for many companies -- and there are lots of layoffs happening in the toy industry and other industries -- it means potentially layoffs.

It might mean lower bonuses or raises.

It might mean less investment in infrastructure here in the United States.

So if we're not raising prices, it usually means we're losing money.

At some point, we will have to start to pass some of the cost of these tariffs to the consumer.

I know that's happening with many different companies in the toy industry as well as other industries.

And, eventually, the price has got to get paid, the piper has to get paid, and it's either going to be in higher prices for the consumers or lower profits for companies.

WILLIAM BRANGHAM: All right, that is Jay Foreman, the CEO of Basic Fun!

toy manufacturer.

Great to talk to you.

Thank you so much for your time.

JAY FOREMAN: Thank you.