(Bloomberg) — President Joe Biden’s commerce chief said it “may make sense” to lift tariffs on some goods as a way to tame the hottest inflation in almost four decades.
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“Steel and aluminum — we’ve decided to keep some of those tariffs because we need to protect American workers and we need to protect our steel industry; it’s a matter of national security,” Gina Raimondo said in an interview Sunday on CNN’s “State of the Union.” “There are other products — household goods, bicycles — it may make sense,” she said, when asked if the administration would consider ending duties on billions of dollars of imports from China.
“I know the president is looking at that,” Raimondo said. “Anyone who brings him a good idea that he thinks will help American families, he’s open to doing it.”
Biden’s team is weighing what to do with former President Donald Trump’s tariffs on about $300 billion of goods imported from the US economy’s biggest rival. While some businesses have benefited from the tariffs protecting them from Chinese import competition, companies that use the goods as inputs in areas including manufacturing have been hurt.
Senior administration officials’ views on what to do with the duties differ: Treasury Secretary Janet Yellen in April suggested the US is open to roll them back to help tame price growth, while US Trade Representative Katherine Tai has highlighted the leverage that the duties provide at the negotiating table with China.
March research from the Peterson Institute for International Economics estimated that eliminating a wide array of tariffs, including those on Chinese goods, could reduce the inflation rate by 1.3 percentage points.
Trump imposed tariffs after an investigation concluded China stole intellectual property from American companies and forced them to transfer technology. China then responded with its own taxes on imports.
The former president also instituted duties on steel and aluminum imports from Europe, Asia and many other nations in 2018, citing risks to national security. While a truce has since been reached with the European Union, Japan and United Kingdom, the US has refused to remove EU steel and aluminum from the list of products considered a threat to its national security.
Last year, Raimondo said Trump’s 25% duty on steel imports and 10% on inward-bound shipments of aluminum have been effective. Steel producers want the duties preserved, but manufacturers have called on Biden to end them, saying they have hurt family-owned businesses and fractured relationships with trading partners from Mexico and Canada to the EU and Japan.
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