President Joe Biden is getting pulled into a war over tariffs on goods from China as he visits Ohio and reportedly weighs easing some of the taxes to counter inflation.
Ohio, a key battleground state for Democrats, contains constituencies invested in the tariffs, which were imposed by former President Donald Trump yet supported by both populist Republicans and many Democrats.
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Rep. Tim Ryan (D-OH), who is running for his state’s Senate seat, has implored Biden to keep the Trump tariffs in place. Ryan was noticeably absent during Biden’s visit, as was Democratic nominee for governor Nan Whaley. Both cited scheduling conflicts, although Biden’s low approval ratings have weighed on Democrats nationally.
Republican J.D. Vance, Ryan’s opponent who was endorsed by Trump in the primary election, is also vociferously against lifting tariffs against China. He said China has been eroding the U.S. manufacturing base in places like Ohio and that the tariffs are a good way of pushing back.
Trump took a shot at Biden following reports that the administration may lift some of the tariffs the Trump White House imposed against China.
Trump, who imposed the tariffs, said in a statement that if the Biden administration goes forward with plans to lift some of them, it would be “a terrible mistake.”
“These tariffs have brought many billions of dollars to our country, and made affected businesses, such as steel, viable again in the United States. Doing this would be the greatest gift that China could ever receive,” Trump said.
He added that removing the tariffs would portray the U.S. as being “weak” and “ineffective.” The former president also panned the idea that tariff relief can bring down inflation as “ridiculous.”
There is a bit of a tug of war in the Biden administration over how to handle changes to the tariffs. Treasury Secretary Janet Yellen and Commerce Secretary Gina Raimondo are pushing for broad tariff relief, arguing that it will dampen the historic inflation that has marked Biden’s first term.
The administration is now reportedly considering whether to lift duties on certain consumer goods, although the details are still under discussion. The narrow tranche of tariffs that officials are deciding whether to lift would only affect about $10 billion worth of imports, compared to the $370 billion levied by Trump.
Labor Secretary Marty Walsh, on the other hand, has been pushing back on efforts to lift tariffs. Labor unions have also been critical of the notion, and U.S. Trade Representative Katherine Tai is reportedly skeptical about lifting them.
Tai said last month that lifting tariffs shouldn’t be the “singular focus” in battling inflation, noting the complexity of the matter. She added that the U.S. should take a “thoughtful, strategic, deliberate” approach to the country’s trade relationship with China.
“If we’re going to take on an issue like inflation and given the seriousness that it requires, then our approach to tools for mitigating and addressing that inflation need to respect that it is a more complicated issue than just tariffs at the border,” she said.
Ohio labor unions and some commercial interests, especially steel mills, have favored some of the Trump tariffs.
About 66% of Chinese exports are subject to U.S. tariffs, and the U.S. tariff rate imposed upon Chinese exports is just above 19%, according to the Peterson Institute for International Economics.
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Inflation has continued to grow this year, with the consumer price index now indicating that prices have increased by 8.6% in the 12 months ending in May — the fastest pace since 1981.
The Federal Reserve is the main entity that can control prices, although its interest rate changes have little effect on the supply side of the equation. Biden has been shackled with blame for the higher prices but also has little he can immediately do to rein them in, which is why tariff changes are being so closely discussed.
