Despite reports, trade adviser denies plans to suspend tariffs
Despite reports, trade adviser denies plans to suspend tariffs
The White House’s top trade adviser, Peter Navarro, is denying that the Trump administration is considering pausing or delaying tariffs to stimulate the U.S. economy. Previous reports had suggested it was something officials were considering.
Tariffs are taxes on imports that American companies and consumers end up paying. For some Americans, tariffs provide an economic boost.
“A lot of those duties are in place because those imports were found to be subsidized or otherwise unfairly traded and injuring American companies,” said Michael Stumo, head of the Coalition for a Prosperous America.
“We don’t want to reduce or delay them because they would reinjure companies that are increasingly injured now,” he said.
But economists from the Federal Reserve to the private sector have compared how much economic benefit the tariffs have brought with how much pain they have created.
“Tariffs cause more losers than winners,” said Dan North, senior economist for North America at Euler Hermes, which provides trade credit insurance. “That is probably costing something like in terms of GDP, 0.3% to 0.5%, so it is a significant drag, especially in this environment.”
A decision to suspend tariffs, and the resulting lower prices, might not get people out of their homes and making major purchases now, but they might do so later. And businesses would benefit from the increased cash flow.
Mary Lovely, professor of economics at Syracuse University, said that a suspension would be aimed at U.S. manufacturers that import items to assemble new goods.
“The tariffs cost firms $900 per worker per year, so you can think of it as an easy way to put $900 per worker back in the companies that are employing those workers,” Lovely said.
If China reciprocated, she added, it would help U.S. farmers who export agricultural goods to that nation.
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