Topline
The Biden Administration is considering ending some Trump-era tariffs on Chinese goods in an attempt to control inflation, Secretary of Commerce Gina Raimondo told CNN on Sunday, as Americans rate the price increases as one of the country’s most pressing issues.
Commerce Secretary Gina Raimondo testifies before a Senate Appropriations Subcommittee on Commerce, … [+]
Key Facts
President Joe Biden has asked Raimondo and other administration officials to analyze possible plans for lifting some of the Trump Administration’s tariffs on Chinese imports, Raimondo told CNN’s Jake Tapper on State of the Union.
The administration has decided to maintain tariffs on steel and aluminum to protect the domestic steel industry, Raimondo said, but she added it “may make sense” to lift tariffs on products like household goods and bicycles.
Raimondo didn’t specify whether any tariffs will be lifted, adding that Biden “will have to make that decision.”
Key Background
The tariffs launched by former President Donald Trump against Chinese goods—part of a protectionist trade strategy aimed at reducing U.S. dependence on imports—were blamed for depressing U.S. stock prices and increasing the prices of consumer goods like clothes and furniture. Beginning in 2018, Trump’s initial tariffs targeted steel and aluminum, materials the U.S. has accused China of dumping onto global markets at low rates, contributing to an oversupply. Tariffs were later expanded to target consumer goods like clothing and sporting supplies. In 2020, China and the Trump Administration signed the Phase One trade deal, under which China agreed to purchase an additional $200 billion of U.S. goods per year in return for the loosening of some tariffs. The following year, Biden reversed some of his predecessor’s tariffs, but left in place tariffs on over $360 billion of goods. China’s apparent failure to meet the terms of the Phase One deal could make it harder for the Biden Administration to justify a comprehensive easing of Trump-era tariffs.
Tangent
As prices for consumer goods surged over the last year, inflation became one of Americans’ foremost worries: A May Pew Research Center poll found 70% of U.S. adults consider inflation a very big problem, more than twice the percentage of Americans who consider racism, infrastructure problems, unemployment and the Covid-19 pandemic very big problems. Month-to-month inflation slowed from 1.2% in March to 0.3% in April, which was higher than the 0.2% forecast for the month but lower than the record-busting increases that dominated headlines over the previous eight months. In April, prices increased 8.3% from the same month one year prior, down from March’s 8.5% year-over-year increase, the first month-over-month decline since August 2021, according to Bureau of Labors Statistics (BLS) data. U.S. gas prices fell 6.1% in April according to BLS statistics, but increased to a record high of $4.848 per gallon Sunday, according to the American Automobile Association.
Further Reading
“70% Of Americans Say Inflation—Near 40-Year High—Is A Huge Problem, Poll Finds” (Forbes)
Source: https://www.forbes.com/sites/zacharysmith/2022/06/05/biden-administration-weighs-ending-some-trump-era-china-tariffs-to-counter-inflation/