President Joe Biden made news this week when he announced a new tariff on goods imported from China in an effort to punish Beijing’s unfair trade practices.
Increased tariffs will be imposed on more than $18 billion in Chinese goods. The ruling is part of an attempt to strengthen American manufacturing and technological development.
The Increases Will Apply to Imported Steel and Aluminum
Steel and aluminum, legacy semiconductors, battery components, solar cells, and cranes will be among the main items affected by the new fees.
In April, Biden announced a 25 percent tariff increase on Chinese steel products brought to the U.S. The increase was announced during a speech at the Pittsburgh Steelworkers Union of America during a standard campaign stop.
Biden’s Statement and White House Perspective
Lael Brainard, the director of the White House National Economic Council, made a statement about the ruling. “China’s using the same playbook it has before to power its growth at the expense of others.”
She went on to state that “China’s simply too big to play by its own rules,” and the U.S. wants to see other countries compete fairly with China. Biden noted that American workers can compete with anyone, but the Chinese have been using unfair tactics to flood markets in different countries and lower prices.
Background on Tariffs and Policy Shift
Biden’s announcement echoes the tariff program initiated by former President Donald Trump, who imposed tariffs on $300 billion in Chinese imports.
The Biden administration’s decision reflects a policy shift, emphasizing clean energy priorities and strong American unions.
Tariffs on Electric Vehicles
China cannot be the only country responsible for producing clean energy. The tariff imposed will directly affect the flow of Electric Vehicles (EVs) into the United States.
China will see its tariffs quadrupled to 100% from 27.5%. This policy is meant to shut down China’s stronghold on the EV market and allow American manufacturers a fighting chance in it. Biden plans to allow strong unions to be responsible for the majority of EVs moving forward.
Potential Retaliation and Future Actions
In Tuesday’s address to the press, President Biden acknowledged that China will most likely retaliate to the ruling. However, he doesn’t believe that Beijing will make a move to being an international conflict with their rival.
Due to China’s lack of worker protections, the country can produce goods at an unsustainable rate. The tariff merely levels the playing field to allow countries that pay their workers living wages to compete with production.
Trump Weighed in on the Controversy
Outside of a courtroom, former President Donald Trump was asked his stance on Biden’s tariff plans. Surprisingly, the two opponents were in agreement on the topic. However, Trump suggested that Biden should have taken this step at the beginning of his term.
After taking a quick jab at Biden, Trump went on to state that “China is eating our lunch right now” about the economic advantage that they have.
Biden’s Prior Statements and Trade Policy
During his campaign stop in Pittsburg, President Biden suggested tripling the previous tariffs that Trump enacted on steel and aluminum products from China.
He also argued that the Chinese government deserves to be investigated for its unfair practices in shipbuilding.
Biden Accuses China of Cheating the System
Part of the reason Chinese steel can be produced so cheaply is the added financial assistance from the government, which Biden claims is cheating, not competing.
The country then produces more steel than any market can reasonably consume. Flooding the market in such a way drags down prices for all parties. China then undercuts more developed nations with dirt-cheap prices that manufacturers can’t pass up.
Biden’s Message Is Well Received Across the Midwest
Parts of the country that rely on manufacturing as the bulk of their industry agree with President Biden.
His message appears well-received across certain states and American and Canadian unions.
China’s Response and International Relations
However, not everyone is happy with Biden’s statements. China’s Ministry of Commerce accused the US of “false allegations” and “wrong practices.”
The move comes as the US has more concerns about Chinese companies’ unsavory business practices. The Chinese-owned company TikTok has been accused of using the popular video app to spy on American data. The company may soon be forced to sell to an American company or be banned from the country.
