How Biden’s tax on Chinese metal harms Americans

Jul 18, 2024

Timothy Carney Senior Fellow, American Enterprise Institute

By Straight Arrow News

President Joe Biden announced plans to triple tariffs on Chinese steel and aluminum to protect American jobs from “unfair” competition. The White House said China is hurting the U.S. economy by selling steel at very low prices.

Watch the video above as Straight Arrow News contributor Timothy Carney argues that while Biden’s new tariffs might help American metal manufacturers, they will cause many problems for American businesses and workers who use these metals.

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The following is an excerpt from the above video:

Taxing these materials obviously makes a new car more expensive, which in turn probably makes used cars more expensive. This is bad for the environment, too, because when new cars are more expensive, folks hold on to their less efficient clunkers for longer.

But it’s not only consumers who suffer. It’s also American automakers and their workers. Auto workers were so important last time Biden was in the White House that the Obama-Biden administration made their bailout of the Big Three a centerpiece of the reelection campaign.

With these tariffs, Biden is putting U.S. carmakers at a disadvantage compared to foreign automakers and machinery [sic] includes farm equipment and factory machinery. So the Biden-Trump tariffs harm those businesses and their workers. Biden knows that his tax increases will harm auto workers, homebuyers and factory workers, but he hopes that these harms will be less visible than the benefits to steel workers.

These tariffs are taxes and the folks who pay them are the regular Americans. Election-year protectionism is something every president does. But that doesn’t make it okay.

Joe Biden is trying to out Trump Trump. And in doing so, he’s harming our economy, making life worse for American families and businesses. When Donald Trump was president, he imposed tariffs on Chinese steel and aluminum. Joe Biden attacked those tariffs back in 2020. But as a 2024 campaign heats up, Biden is expanding those Trump tariffs, and they will now apply to steel and aluminum imported through Mexico. Tariffs are taxes, and they are not paid by foreign companies or governments. They are paid by the Americans who import goods or materials. Higher taxes on raw materials will benefit some US manufacturers, those who make steel or aluminum, but it will hurt other US manufacturers, those who use steel or aluminum, who uses steel and aluminum. The three main uses of steel and aluminum in the US are construction, cars, and machinery. So the very first impact of the Biden Trump tariffs is to make it more expensive to build homes. That means there are fewer homes built and those that are built cost more to buy. America currently has a housing shortage, and Biden is exacerbating it by slowing down homebuilding. Cars are mostly aluminum and steel. Taxing these materials, obviously makes a new car more expensive, which in turn probably makes use cars more expensive. This is bad for the environment, too. Because when new cars are more expensive, folks hold on to their less efficient clunkers for longer. But it’s not only consumers who suffer. It’s also American automakers and their workers. Auto Workers were so important. Last time Biden was in the White House that the Obama Biden administration made their bailout of the big three, a centerpiece of the reelection campaign with these tariffs. Biden is putting us carmakers at a disadvantage compared to foreign automakers. And machinery includes farm equipment and factory machinery. So the Biden Trump tariffs harm those businesses and their workers. Biden knows that his tax increases will harm auto workers, homebuyers and factory workers. But he hopes that these harms will be less visible than the benefits to steel workers. These tariffs are taxes and the folks who pay them are the regular Americans. Election Year protectionism is something every president does. But that doesn’t make it okay.