Tariffs on Chinese-made goods have cost Americans more than $20 billion, and President Donald Trump is apparently ready to hike that tax bill again.
Unhappy with the progress that's been made towards a trade deal with China, Trump on Thursday announced plans to hit about $300 billion worth of Chinese imports with a 10 percent tariff starting on September 1, 2019. Combined with the existing tariffs of 25 percent on about $250 billion worth of Chinese-made goods, the new tariffs will effectively cover all goods imported from China.
"Our representatives have just returned from China where they had constructive talks having to do with a future Trade Deal," Trump wrote on Twitter. Apparently, the talks were not constructive enough. Trump singled out China's refusal to buy more American agricultural goods, failing to mention that American firms were exporting those same goods to China in higher quantities before Trump launched his trade war.
The Dow Jones Industrial Average, which had gained about 300 points during the day's trading, plunged by more than 500 points in the hour after Trump's tweets announcing the new tariffs.
The announcement marks the end of a lull in the trade war. After a series of escalations throughout 2018, Trump earlier this year had backed away from plans to impose tariffs on the remaining $300 billion of Chinese-made goods Americans import starting on March 1. He'd also lifted the steel and aluminum tariffs on imports from Canada and Mexico, and he seemed to have reconsidered earlier threats to put tariffs on imported cars. Although the existing tariffs continued to act as a drag on the economy—business investment, in particular, has fallen dramatically since the start of the trade war—there was reason to hope the "Tariff Man" had recognized his trade war isn't making America great.
Thursday's announcement could be another bluff, of course. If it's not, lots of American businesses will take another hit.
"Raising tariffs by 10 percent on an additional $300 billion worth of imports from China will only inflict greater pain on American businesses, farmers, workers and consumers, and undermine an otherwise strong U.S. economy," said Myron Brilliant, executive vice president for the U.S. Chamber of Commerce, in a statement.
The new round of tariffs will hit many consumer goods previously spared from the trade war—in earlier volleys, the Trump administration had mostly targeted industrial goods and items used for manufacturing. The list of items targeted with the new tariffs includes home electronics like speakers and televisions; baby equipment like strollers and cribs; recreational items including tents, fishing equipment, and bicycles; as well as clothing, shoes, and books.
Jonathan Gold, a spokesman for Tariffs Hurt The Heartland, an anti-tariff group, accused the president of "doubling down on a failing strategy."
"Nobody wins in a trade war, and raising tariffs further on American businesses and consumers will only result in slower economic growth, more farm bankruptcies, fewer jobs, and higher prices," Gold said."It's time for the administration to come up with a real strategy, put a stop to harmful tariffs and finally deliver the trade deal Americans were promised."