The White House hasn’t yet made up its mind on whether to cut or remove its China tariffs to ease inflation, officials said on Tuesday.
President Joe Biden is unlikely to announce a decision until after he speaks to Chinese leader Xi Jinping – a planned call that is yet to be scheduled, his chief spokeswoman said.
After weeks of deliberations with stakeholders over cutting tariffs as a way to ease high inflation, White House press secretary Karine Jean-Pierre said Biden’s team was still weighing various strategies.
More than 400 requests to keep the China tariffs in place had been submitted to the US Trade Representative’s office as of late Tuesday, complicating Biden’s decision-making.
Among these are a committee of 24 labour unions from the trade union umbrella organisation AFL-CIO to the Air Line Pilots Association and United Steelworkers, which have requested the “Section 301” tariffs imposed by former president Donald Trump continue, covering some $370 billion in Chinese imports.
US Economy Hit by Inflation
If he substantially removes the tariffs, Biden would have to turn his back on a key constituency. He has described himself as the most pro-labour president ever, heavily relying on unions to power his Democratic Party primary and general election wins in 2020.
“There are a lot of different elements to this, especially since the previous administration imposed these tariffs in such a haphazard way, in a non-strategic way,” Jean-Pierre said. “So we want to make sure that we have the right approach. And again, his team is talking, is figuring it out, and they’re talking through this.”
People familiar with the tariff deliberations have said that Biden also is weighing whether to pair a removal of some tariffs with a new Section 301 investigation into China’s industrial subsidies and efforts to dominate key sectors, such as semiconductors.
A probe would take up to a year to conduct and could lead to a new round of tariffs, but the sources said that Biden can claim that any such duties would be more strategically focused than many of the current tariffs on consumer goods such as cotton sweaters and home internet routers.
The deliberations come as USTR is conducting a four-year statutory review of the tariffs, with one deadline for submitting requests to keep tariffs in place expiring late on Tuesday and another lasting until August 22.
The tariff issue was raised during a call between US Treasury Secretary Janet Yellen and Chinese Vice Premier Liu He on Monday night, but a Treasury statement did not mention the duties and focused on broader economic challenges and Russian sanctions.
- Reuters, with additional editing by George Russell