And as businesses begin reopening under their states’ guidelines, President Trump’s tariffs stand as a major barrier preventing farming, manufacturing, retail, and other small business sectors from fully standing on their own two feet.
The American economy needs a kickstart – especially as we dig ourselves out of the financial hole that the coronavirus has left us in. One of the best and simplest ways to achieve this goal is by repealing these tariffs – which are taxes paid to the federal government by U.S. businesses. This would give businesses a much-needed increase in cash on hand.
What many Americans don’t realize is that President Trump’s tariffs are a direct tax on their businesses, both large and small. As of March 2020, the president’s trade war has cost American business owners about $57 billion. That is hard-earned money that could have been used to pay rent, employee salaries, or bills; all of which are necessary expenses that businesses are now struggling to pay because they have been forced to shut down because of the pandemic.
The Phase One trade deal may have been a step forward before the coronavirus pandemic, but there are questions about China’s ability to live up to the deal. China has already made it clear that, given their own economic downturn, they are unable to meet the requirements of President Trump’s Phase One trade deal, one of which is buying $200 billion of U.S. goods.
President Trump first imposed tariffs in an effort to hold China accountable for stealing American intellectual property and to bring countries, specifically their own, to the negotiating table for a trade deal. The result – however – has been the opposite. Tariffs have limited the ability for American businesses to compete in the international economy, forcing them to pay a tax on their products before they hit the marketplace. U.S. farmers and manufacturers have also been hit with retaliatory tariffs which further impact their ability to sell to overseas markets.
What’s worse, American businesses will no longer see any kind of return from the deal, as the $200 billion purchase of U.S. goods over two years is clearly out of reach given the ongoing coronavirus. Tariffs, in turn, leave American businesses with an unnecessary, burdensome tax that no longer creates any benefit or leverage when negotiating.
American businesses are on life support and one of the best ways to ensure that they come out of this pandemic alive is to repeal tariffs completely. By doing so, President Trump will be putting American businesses first, something we can all applaud.
The coming weeks will be critical in shaping the recovery. President Trump has exhibited strong leadership in rebuilding the U.S. economy, but experts agree that his position on tariffs and trade amounts to a policy failure and political shortcoming. If we are to come out of this pandemic solidifying our position as a global leader in manufacturing and trade, then the first step is repealing tariffs.