The Commerce Chief of President Biden’s government said that lifting tariffs on some goods make sense at will help to tame the hottest inflation seen in four decades.
Removing tariffs to tame inflation
In an interview Sunday with CNN’s “State of the Union” program, Gina Raimondo said they have decided to keep some of the tariffs intact, especially the Steel and Aluminum, as they need to protect the steel industry and American workers.
When asked if the Administration was considering ending duties on imports from China valued at billions of dollars, she said that other products such as bicycles and household goods made sense. Raimondo said that President is looking into it, and if anyone can bring him a good idea that will help American families, he is open to it.
Biden’s team is thinking of what to do with the tariffs imposed on about $300 billion worth of goods imported from China, the U.S. economy’s biggest rival. Many businesses have benefitted from the tariffs as it has helped protect them from importing Chinese goods, but the other companies that manufactured goods as inputs have been hurt.
The China-U.S. tariffs
As per Bloomberg News, Senor Officials in the Administration differ in their views on duties imposed. In April, Janet Yellen, the Treasury secretary, suggested that the U.S. is open to tariff rollback to cool down inflation. Katherine Tai, the U.S. trade representative, has highlighted how imposing tariffs have helped leverage China negotiations.
Research by Peterson Institute for International Economics in March had estimated a 1.3 % reduction in inflation if tariffs on a wide range of goods, including Chinese imports, were implemented.
Trump had imposed duties after an investigation found that China was stealing intellectual property from companies in the U.S. and forcing them to transfer technology. China responded by imposing tariffs on its imports from the U.S.
Citing risks to national security, the former President had imposed duties on aluminum ad steek imports from Asia, Europe, and other nations in 2018. Though a truce has been reached with Japan, the United Kingdom, and the European Union, the U.S. has refused to remove Aluminum and still from the product list that is considered a threat to the national security.
According to Raimondo, Trump’s imposition of a 10% duty on inward Aluminum shipments and a 25% duty on Steel has been effective. Steel producers want the duties on steel imports to remain. Still, manufacturers wish the President to end the duties as it has hurt family-owned American businesses and fractured their relationships with trading partners Canada, Mexico, Japan, and the E.U.
