Source: Christopher Arps
While the economy continues to recover from the COVID-19 pandemic, recent inflation has brought on an entirely new set of worries for businesses and families throughout the nation. Rising prices have placed immense stress on Americans and lawmakers at every level of government have been struggling to find ways to get it under control.
One approach, outlined by the Biden administration, is to inject significant investments into social programs, which they claim will free up workers and businesses to be more efficient, ultimately easing inflation. While that argument’s long-term merits will be debated well into the next election cycle, the reality that Americans continue to face is steadily rising prices as lawmakers debate the details and timing of these legislative packages. If the goal is to ease the pain consumers and businesses are feeling right now, the Biden administration will need to look for alternative solutions.
Another more immediate solution, as was recently acknowledged by Senator John Boozman (R-AR), who is the ranking member on the Senate Agriculture Committee, is something that business leaders across the country have been clamoring for over the past several years: lifting the harmful tariffs that remain in place on imports from China.
These tariffs, which former President Trump initially implemented as a means of punishing China for its numerous trade malpractices, have proven to be an enormous burden for businesses, manufacturers, farmers, and other industries stateside. Tariffs are taxes that U.S. importers, not China, pay to the U.S. government to purchase the goods they need to run their business. As the tariffs have gone up, so have operating costs for businesses in various sectors across the U.S. As we all know, these costs are ultimately passed on to the consumer.
These costs have only been exacerbated as businesses work to recover from the disruptions caused by the COVID-19 pandemic and the ongoing global supply chain crisis. Many businesses are still reeling and now, at a time when they are most vulnerable, they are still forced to pay the costs of tariffs on the things they need just to keep their doors open.
Some leaders in the Biden administration have signaled they understand how lifting those tariffs could provide relief from inflation. Treasury Secretary Janet Yellen has on two separate occasions spoken about the ways tariffs raise prices for businesses and consumers alike, recognizing that lifting the tariffs could provide some much-needed relief.
President Joe Biden and U.S. Trade Representative Katherine Tai should do the same and end a trade conflict that, while well-intentioned, has ultimately backfired on American businesses, workers, families, and consumers. Lifting the tariffs is a measure they can take without needing to go through extended fights on Capitol Hill. This action would provide an immediate boost to struggling businesses — that the vast spending packages still being debated in Washington haven’t. The administration would be wise to act now.
Between inflation, the supply chain crisis, and tariffs, U.S. businesses are under enormous economic pressure. To help those businesses and live up to its lofty economic goals, the Biden administration should realize it has no choice but to eliminate these tariffs and put an end to what has been a chronic issue for the U.S. economy since 2018. It is common-sense policy, and something the economy desperately needs.