President Joe Biden and former President Donald Trump have both utilized tariffs as a policy tool during their time in office. While tariffs can serve to protect and enhance domestic industries, there is a growing concern that they can result in higher prices for American consumers. According to Erica York, a senior economist with the Tax Foundation’s Center for Federal Tax Policy, tariffs are essentially a tax increase that ultimately gets passed on to consumers. This assertion is supported by Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center, who highlights that it is American companies importing Chinese goods who end up bearing the costs of tariffs and passing them on to consumers.
During his time in office, former President Donald Trump engaged in a trade war with China that resulted in the collection of approximately $233 billion in tariffs by U.S. Customs through March 2024. The Tax Foundation’s analysis revealed that U.S. consumers paid the price for these tariffs through higher prices on imported goods. Trump’s tariff proposals during his 2024 campaign included a 10% universal baseline tariff on all U.S. imports, a 100% tariff on imported cars, and the idea of using tariffs on countries linked to illegal immigration in place of federal income tax. Christopher Tang, a global supply chain professor, highlighted Trump’s escalating tariff plans, signaling an increase from 25% to 60% if re-elected.
In contrast, President Joe Biden has taken a more targeted approach to tariffs, focusing on specific sectors and products. The Biden administration announced new tariff rates in May 2024 on $18 billion worth of Chinese imports, which included a 100% tariff on electric vehicles, a 50% tariff on solar cells, and a 25% tariff on steel and aluminum. Additionally, starting in 2025, Chinese semiconductor tariffs will double to 50%. Despite initial promises to remove Trump’s tariffs upon taking office, Biden has largely upheld the trade war tariffs.
While President Joe Biden and former President Donald Trump have differing approaches to tariff policy, the impact on American consumers remains a shared concern. Both leaders have utilized tariffs as a means to protect domestic industries and achieve political goals, but the ultimate burden falls on consumers in the form of higher prices. Moving forward, it will be crucial for policymakers to carefully consider the implications of tariff policies on the economy and ensure that the interests of American consumers are prioritized.
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