July 10, 2020

Trump Is More Vulnerable to Democratic Attacks on Trade Than You Might Think

Rather than focusing on a few discrete areas where international competitors have treated American companies unfairly and applying temporary tariffs to try to exert pressure, the Trump administration has applied open-ended tariffs on imports of nearly 7,000 different items.

The administration has also placed tariffs on “intermediate goods,” so that efforts to create jobs in one sector can mean higher costs and fewer jobs in another. The taxes on many steel and aluminum imports, for example, may be creating some jobs in those sectors while increasing costs for automakers and other American companies that use the metals.

And trading partners have been savvy about using retaliatory tariffs to punish Mr. Trump’s base, most notably on American farm products.

Combine those factors, and the trade war so far has offered more pain than it has a clear pathway to better deals for American companies and workers. Especially with China, it has often seemed that rather than seeking to achieve attainable goals, the conflict is the whole point.

Early jockeying between the Trump White House and the Democratic front-runner Joe Biden’s presidential campaign suggests that the president would, in a potential matchup, claim Mr. Biden is weak on China.

But how that will play if the trade war with China causes more evident economic pain?

The first round of tariffs against China was limited to goods purchased mainly by businesses. But in seeking to apply more pressure on China to make major overhauls, the Trump administration is taxing about $200 billion worth of imports from China at 25 percent, a list of goods that includes many consumer products like furniture and auto parts.

That went into effect in early May and, given the time it takes for container ships to go from China to the United States, is only beginning to ripple through to the costs of consumer goods.

Article source: https://www.nytimes.com/2019/06/08/upshot/trump-is-more-vulnerable-to-democratic-attacks-on-trade-than-you-might-think.html?emc=rss&partner=rss

Speak Your Mind