Despite the mounting evidence that it is a failed strategy, the president has threatened to increase tariffs on China to 25%.
The headline in Quartz probably says it best: “The White House says China tariffs don’t work — so it’s proposing even more tariffs.”
Increased tariffs would target $200 billion in Chinese goods.
And according to Axios, a majority of American business owners actually want more tariffs against China.
It almost seems like if the farmers get bailed out, everyone else will jump on board.
Derek Scissors, a China scholar at the American Enterprise Institute, postulated on NPR that the increase in tariffs was a response to the strategic depreciation of the Chinese renminbi.
“In the past six months, especially in the past two months, China has allowed its currency, the renminbi, to depreciate. It’s depreciated a total of 8 percent since the spring. If you’re going to apply 10 percent tariffs and their currency is getting 8 percent cheaper, you’ve lost most of the effect of the 10 percent tariffs. So you need the option to go to 25 percent, one, to really apply the tariffs but also to signal the Chinese that their depreciation strategy isn’t going to work.” — Scissors
Naturally, Chinese officials have said that they have no issue with implementing additional tariffs of their own.
There will be a period of time before the increased tariffs go into effect during which business owners and those affected by the tariffs will be able to lodge commentary, but we know how much the administration values public opinion, so we aren’t holding our breath.
“I think this is a very serious situation. I think it would be a very complicated thing to get out of, because I don’t see an easy remedy once we go down this path.” — Michael Camuñez, president and CEO of Monarch Global Strategies and former U.S. assistant secretary of commerce for market access during the Obama administration
This news comes just as it has been revealed that the Trump administration placed an enormous order for 2020 campaign flags and banners with a Chinese flag-making company before the tariffs went into effect.
Iron Triangle Press will continue to follow this story.