Senior White House officials confirmed Wednesday that the administration will consider tariffs of up to 25 percent on $200 billion of goods from China, up from their original plan of just 10 percent tariffs. The officials, speaking anonymously to reporters, said the move was a direct order from President Trump himself to U.S. Trade Representative Robert Lighthizer and was intended to force China to agree to negotiations on its policies.
“This week, the President has directed that I consider increasing the proposed level of the additional duty from 10 percent to 25 percent. The 25 percent duty would be applied to the proposed list of products previously announced on July 10,” Lighthizer said a statement. “The Trump Administration continues to urge China to stop its unfair practices, open its market, and engage in true market competition.”
[More: China a ‘longer-term problem,’ USTR Robert Lighthizer says]
The reason for the change: Previous threats from the administration and existing tariffs had not gotten China to change its policies, so the administration is increasing the pressure. “The key question here is: ‘What can we do to encourage them to change their behavior?'” said a White House official who briefed reporters.
The tariffs would target thousands of Chinese imports, ranging from raw materials like chemicals, steel, and aluminum to consumer products like cosmetics, furniture, toys, human food, and dog food. The administration will allow public comments on the proposed tariffs through Sept. 5 and hold a public hearing as well.
The U.S. has accused China of predatory trade practices, arguing Beijing uses deals with U.S. companies to coerce them into turning over technology. The tariffs are being carried out under the authority given to the president by Section 301 of the Trade Act, which covers protecting national security.
The administration has already imposed broad-based tariffs of 25 percent on steel imports and 10 percent on aluminum ones, policies primarily directed at China. Trump has placed 25 percent tariffs on $34 billion of goods specifically from China with another $16 billion in goods being considered. Earlier this year, the White House also released a list of $200 billion in Chinese goods it planned to hit with the 10 percent tariffs and threatened to enact additional levies on $200 billion in goods on top of those.
In retaliation, China has established 5 to 25 percent additional duties on $3 billion in U.S. imports and threatened further actions. “U.S. pressure and blackmail won’t have an effect,” Chinese Foreign Ministry spokesman Geng Shuang told reporters Wednesday. “If the United States takes further escalatory steps, China will inevitably take countermeasures and we will resolutely protect our legitimate rights.”
Lighthizer has conceded that getting China to change its policies would be hard. Lighthizer said in a Senate hearing last week that the issue was that China’s industrial policy, in the case of steel, resulted in them developing major overcapacity for political, not economic reasons.
“They have 300 million tons of excess capacity. To give you a relative idea, we make in the United States something just south of a hundred million tons of steel. In China, they make 1.1 billion tons,” he said, adding that “they created it largely to get rid of imports. As these things do, it got out of control and then they got so big they swamped the entire world.””
