In the past, there was a nonpartisan consensus surrounding tariffs, and the consensus was that they suck. The past is gone, but not forgotten.
Yet conservatives and the far right warmed rather quickly to President Donald Trump’s recent move to hike tariffs on Chinese imports to 25 percent, up from 10. That support was earned despite some common understandings about tariffs, specifically that they can create trade wars that slow the economy and lead to higher prices for consumers. Most economists also believe tariffs exacerbated the Great Depression.
On Friday, Fox News contributor Liz Peek argued in militant support of higher tariffs, writing: “Just as a military conflict should bring the country together, so should this trade war. President Xi should find no succor among American politicians, on either side of the aisle.”
I don’t hear the word “succor” too often, so my interest was piqued right away. The bummer with tariff cheerleading, though, is that it oversimplifies economic factors that are mind-numbingly complex.
Fact or fiction: Is China’s trade policy unfair?
This is a regular complaint from Trump and conservatives like Peek, and although I won’t weigh in, I can share a little background.
Since his 2016 run, Trump has held steadfast in his belief that China devalues its currency, when for the last few years, the Chinese government has actually taken actions that increased the value of the yuan.
Other complaints against China are more rooted in reality, though. In order to work with Chinese companies, foreign corporations often have to turn over their intellectual property first. Americans also can’t invest in Chinese state-owned businesses.
And before China raised tariffs on American imports, the country already had a higher combined tariff and tax rate than the United States’ rate on Chinese imports. In 2017, China’s combined tax and tariff rate stood at 27 percent, towering over the United States’ total rate of 9 percent, according to a CBS News report.
Fact or fiction: Did Beijing’s trade policies force millions of American manufacturing jobs to move to China and other countries?
Since 1980, the United States lost about 7.5 million manufacturing jobs, and according to the Bureau of Labor Statistics, that exodus wasn’t due to hostile trade policies from China. During the 2000s, increased competition with China was responsible for just a quarter of lost manufacturing jobs.
A 2015 study from Ball State University’s Center for Business and Economic Research found that 88 percent of manufacturing job losses were due to increases in productivity, which was largely spurred by automation. The research also pointed to trade and domestic demand as causes.
BLS also attributed lost manufacturing jobs to the low availability of workers with the right skills for the work. Part of how that works is that automation caused technology to replace low-skilled jobs and made manufacturing work require greater levels of skill. Jeffrey Rothfeder, former International Business Times editor, maintained several years back that retraining workers would help them more than anything else.
From what I’ve read, there doesn’t appear to be a consensus on the main reason why manufacturing jobs are on the decline, in part, because it’s complicated and there are multiple factors, not just one. However, pinning the blame on China’s trade policies alone neglects the role of American corporations in choosing to outsource manufacturing work, as well as elements like automation that would affect production in the United States no matter what China is doing.
Fact or fiction: Does the government plan to give farmers $15 to $20 billion to “soften” the blow from tariffs?
Yes. Bloomberg reported Tuesday that the Trump administration could provide more than $15 billion in aid to farmers facing losses due to the tariffs.
Note: American Mythology is a series where we factcheck an entire piece or debunk a topic across multiple publications or platforms. You can learn more about our approach to factchecking here.
Contact Mollie Bryant at 405-990-0988 or bryant@bigiftrue.org. Follow her on Facebook and Twitter.