The Continuing Farce of the U.S. Tariff War

by | May 16, 2024

The Continuing Farce of the U.S. Tariff War

by | May 16, 2024

china united states trade

In recent years, American politics has been mired in a narrative of fear and suspicion surrounding China—a narrative perpetuated by successive administrations, defined by nothing so much as speculation and hysteria, and which has fueled the production of a plethora of counterproductive protectionist policies. The latest move by the Joe Biden administration to impose steep tariffs on Chinese imports, including electric vehicle (EV) batteries, computer chips, and medical products, is just another chapter in this saga. The damaging consequences of such policies touch not only tensions with China, already greatly exacerbated, but also inflict significant costs on American consumers, firms, and taxpayers.

Remember: no matter how they are packaged up and sold, usually wrapped in the flag under such rhetorical arabesques as “Buy American!” or cries of “National Security!” tariffs by their very nature serve to protect domestic industries from foreign competition at the expense of domestic consumers. When tariffs are imposed, they artificially inflate the prices of imported goods, making them more expensive for consumers. This not only diminishes consumer purchasing power but also limits choices in the marketplace. Moreover, tariffs tend to benefit politically connected domestic producers who are capable of acquiring protection, thereby increasing their market power and stifling competition. In the end, tariffs primarily burden domestic consumers, who bear the brunt of higher prices while receiving little, if any, tangible benefits in return—except, of course, those politically connected firms who benefit. In this case, the politically important American automotive makers and their unions, who need “protecting” from products BYD’s Seagull, a competition crushing EV that sells for about $10,000.

Politics being politics, despite Biden’s promising, previous criticism of Donald Trump’s protectionist policies while campaigning for office in 2020, his administration has adopted and even amplified them as election season 2024 ramps up; the new tariffs just announced double, triple, and even quadruple the levies on the above listed imports.

Trump, for his part, has floated numbers as high as 60% across the board.

Of course, as stated in the opening, these tariffs are not isolated actions but part of a broader trend of anti-China legislation sweeping through Congress and state legislatures across the country. From bills targeting TikTok for a forced sale to measures restricting Chinese citizens from buying land in states like Georgia and Florida, the China threat hysteria has permeated every level of government, feeding into a dangerous cycle of retaliation and escalation.

For example, the Trump administration’s tariffs on various imports in 2018 were intended to bolster American industries and punish foreign exporters. However, the Chinese (obviously) retaliated, and the economic evidence shows that American firms and consumers bore the brunt of these tariffs. Studies examining the tariffs on washing machines, solar panels, aluminum, steel, and goods from China and the European Union, for example, found that American firms and final consumers bore the entire burden of tariffs, resulting in billions of dollars in losses annually for the U.S. economy.

Furthermore, the Trump-Biden tariffs have bypassed congressional approval, with funding for programs like the Market Facilitation Program coming from the Credit Commodity Corporation. This unprecedented use of these government funds (predictably) lacked proper oversight, leading to millions of dollars being sent to farms improperly.

The Biden administration’s decision to escalate tariffs on Chinese imports, therefore, only serves to perpetuate the destructive retaliatory cycle—with Beijing already promising to respond. While touted as measures to protect American industries and national security, these tariffs impose significant costs on American consumers, firms, and taxpayers, while doing little to address the underlying issues. Instead of succumbing to fear and suspicion, policymakers must pursue a more constructive and pragmatic approach to U.S.-China relations, one that prioritizes diplomacy, dialogue, and mutual cooperation.

In conclusion, the new tariffs on Chinese imports must be seen in the context of the broader fake China threat hysteria that has dominated American politics in recent years. From TikTok bans to land restrictions, the China threat narrative has permeated every level of government, driving destructive policies that harm both countries’ economies and global stability. It is time for policymakers to reject fear and suspicion and pursue a more constructive path forward—one that promotes cooperation and dialogue rather than confrontation and conflict.

Joseph Solis-Mullen

Joseph Solis-Mullen

Author of The Fake China Threat and Its Very Real Danger, Joseph Solis-Mullen is a political scientist and economist at the Libertarian Institute. A graduate of Spring Arbor University, the University of Illinois, and the University of Missouri, his work can be found at the Ludwig Von Mises Institute, Quarterly Journal of Austrian Economics, Libertarian Institute, Journal of Libertarian Studies, Journal of the American Revolution, and Antiwar.com. You can contact him via joseph@libertarianinstitute.org or find him on Twitter @solis_mullen.

View all posts

Our Books

libertarian inst books

Related Articles

Related

Rights for the Synthetic

Rights for the Synthetic

"The future of human-AI coexistence depends on acknowledging the potential for sentient machines and reevaluating responsibilities towards them. It's crucial to consider the ethical implications of creating beings that may possess their own interests, desires, and...

read more
A Critique of Pure Hasbara

A Critique of Pure Hasbara

Hasbara is a central feature of genocidal Zionism: “Since its establishment in 1948, Israel has successfully created a new illogic of its own; an illogic that has made the illegal seem legal, the immoral appear moral and the undemocratic sound democratic. It has...

read more
On Wealth Inequality, the Left Has a Point

On Wealth Inequality, the Left Has a Point

The federal government has been waging a war against the middle class and working poor since at least 1970. Wealth inequality has steadily increased since the early 1970s, and it’s not a coincidence. It’s a result of a series of policies. The government wants the...

read more
Joe Biden’s Time Interview Should Set Off Alarms

Joe Biden’s Time Interview Should Set Off Alarms

On May 28, U.S. President Joe Biden gave an interview to Time. His delivery and content were concerning for a number of reasons. Biden, at times, seemed misinformed and detached from reality. Sometimes, he seemed off message; other times, he seemed convinced by his...

read more
DOJ, Lay Off Live Nation!

DOJ, Lay Off Live Nation!

Last month, the U.S. Department of Justice (DOJ) finally came out with their long anticipated antitrust lawsuit against Live Nation Entertainment. Alleging anti-competitive practices which “suffocates its competition,” everyone’s least favorite Attorney General (since...

read more
Why Libertarians Loathe Tariffs

Why Libertarians Loathe Tariffs

Former president and current Republican presidential candidate Donald Trump loves tariffs. In his 2011 book Time to Get Tough: Making America #1 Again, Trump included as part of his five-part tax policy “a 20 percent tax for importing goods.” During his first campaign...

read more

Pin It on Pinterest

Share This