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Opinion | Why Biden won’t beat China by out-Trumping Trump on trade tariffs
- Joe Biden’s decision to double down on Donald Trump’s China tariffs harks back to policies that might have worked in the 1980s, and is a loser
- The US president was on the right track with building US economic muscle at home, and he and the country would be better served by focusing on that
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One of the biggest missteps so far of US President Joe Biden’s tenure is not scrapping former president Donald Trump’s China tariffs on his first day in the White House.
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All Trump’s 2017-2021 tariffs did was raise prices for US consumers. They did little, if anything, to alter Sino-US trade dynamics. China’s economy has largely steered around Trump’s trade war, leaving US allies such as Japan and South Korea with the collateral damage.
Why would Biden think doubling down on this approach is a good idea with US inflation already stubbornly high? And all this as the White House says it is pursuing a reboot of China relations.
Last week, Biden announced a 100 per cent tariff on electric vehicles (EVs) from China, roughly a quadrupling of earlier levies. Tariffs are also surging on solar cells, advanced batteries, construction cranes and medical equipment, as well as steel and aluminium.
Count the ways Biden trying to out-Trump Trump is sure to backfire. One is higher costs for US households. Another is more pressure on global supply chains. And let’s not forget the ways China is sure to retaliate.
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US Treasury Secretary Janet Yellen isn’t stupid. Yet she followed the announcement of the tariffs with painfully naive talking points. “Hopefully we will not see a significant Chinese response,” Yellen told Bloomberg, somehow with a straight face. “But that’s always a possibility.”
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