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  • Writer's pictureThe San Juan Daily Star

How Biden’s trade war with China differs from Trump’s

Former President Donald Trump delivers remarks during a campaign rally at the Waukesha County Expo Center in Waukesha, Wis., on May 1, 2024. Joe Biden ran for the White House as a sharp critic of Trump’s crackdown on trade with China. In office, though, he has taken Trump’s trade war with Beijing and escalated it, albeit with a very different aim. (Doug Mills/The New York Times)

By Jim Tankersley

Joe Biden ran for the White House as a sharp critic of President Donald Trump’s crackdown on trade with China. In office, though, he has taken Trump’s trade war with Beijing and escalated it, albeit with a very different aim.

The two men, locked in a rematch election this fall, share a rhetorical fondness for beating up on China’s economic practices, including accusing the Chinese of cheating at global trade. They also share a building-block policy for countering Beijing: hundreds of billions of dollars in tariffs, or taxes, on Chinese imports. Those tariffs were first imposed by Trump and have been maintained by Biden.

On Tuesday, Biden announced that he is increasing some of those tariffs. That includes quadrupling electric vehicle tariffs to 100%, tripling certain levies on steel and aluminum products to 25%, and doubling the rate on semiconductors to 50%.

But Biden’s trade war differs from Trump’s in important ways. Trump was trying to bring back a broad swath of factory jobs outsourced to China. Biden is seeking to increase production and jobs in a select group of emerging high-tech industries — including clean energy sectors, like electric vehicles, that Trump shows little interest in cultivating.

Biden has pulled more policy levers, some of them created by Trump. He has imposed more restrictions on trade with China, including limiting sales of U.S. technology to Beijing, while funneling federal subsidies to U.S. manufacturers trying to compete with Chinese production.

And in a break from Trump’s go-it-alone posture, Biden’s strategy relies on bringing international allies together to counter China through a mix of domestic incentives and, potentially, coordinated tariffs on Chinese goods.

As they compete for the White House again, Biden and Trump are both promising to further increase trade pressure on China, which both men accuse of unfair trade practices that disadvantage American workers. Here is how their plans overlap and where they diverge.

Trump’s plan includes more tariffs and less trade.

Trump broke decades of political consensus by pushing aggressive restrictions on trade with China as president. He imposed tariffs on more than $360 billion worth of Chinese products, including toys, electronics and household furnishings, drawing retaliatory tariffs from Beijing.

In 2020, he struck an agreement with Chinese officials that called for China to increase its purchases of exported goods from America, including agricultural products, and carry out a series of economic reforms. China came nowhere close to fulfilling those terms. Lael Brainard, the director of Biden’s National Economic Council, told reporters this week that the deal “did not deliver on its promises.”

Trump has pledged new efforts to sever the nations’ trading relationship if he is elected to a second term. Those include barriers to investment between the two countries, along with bans on imports of Chinese steel, electronics and pharmaceuticals. He has also proposed an additional 10% tariff on all imports to the United States, not just those from China. And he has criticized Biden.

Chinese officials were “petrified of me putting on additional tariffs,” Trump told CNBC in March. “And we don’t use that; China is right now our boss. They are the boss of the United States, almost like we’re a subsidiary of China, and that’s because the Biden administration has been so weak.”

Biden is building on his predecessor’s efforts.

Biden was once a critic of Trump’s tariffs. “President Trump may think he’s being tough on China,” Biden said in a 2019 speech, as a candidate for president, “but all he has delivered is more pain for American farmers, manufacturers and consumers.”

Early in Biden’s administration, his aides debated rolling back many of Trump’s taxes on Chinese imports to ease the pain of rapid price increases. They ultimately decided against it. Instead, Biden announced Tuesday that he is increasing tariffs on about $18 billion worth of Chinese imports, including solar cells, ship-to-shore cranes and certain medical technologies.

His administration has also imposed new restrictions on exports of U.S. semiconductors and chipmaking materials to China, and it has taken the first step to cracking down on imported Chinese smart car technologies.

Administration officials offer economic rationale for all of those moves. But Biden is also responding to swing-state political pressures — and seeking to outflank Trump on the China issue. Last month, he called for higher taxes on Chinese heavy metal imports in a speech to steelworkers in Pennsylvania, a crucial state where polls show he is struggling to overcome voter anxiety about the economy.

And while Biden aides say his tariff approach is more targeted — and, by extension, more effective — than Trump’s, the president has notably decided not to roll back any of the original tariffs that Trump imposed on Chinese products.

The war is greener, and with allies this time.

Biden has tailored his policy, though. He has consciously coupled new restrictions on China trade with the strategic investments, in the form of government spending and tax credits, that he has used to entice new factory production in a handful of targeted sectors.

Perhaps no product better exemplifies the divergence between Biden and Trump on trade policy than electric vehicles. Trump sees them as a scourge and has said efforts to accelerate their adoption will result in an “assassination” of U.S. jobs.

Biden has signed multiple laws meant to supercharge electric vehicle production and consumption in the United States, including an infrastructure bill with funding for 500,000 charging stations and a climate law with lucrative incentives to make and sell the vehicles in the United States. They are part of an ambitious industrial strategy to build up U.S. factory capacity for a host of clean energy technologies meant to fight climate change and to dominate advanced manufacturing industries globally for decades to come.

Biden is increasingly worried that a flood of low-cost electric cars and other goods from China could undermine those efforts, and he is using trade policy to protect his industrial investments. His tariff increases include a quadrupling of the rate on imported electric vehicles, to 100%.

And while Trump antagonized allies by imposing tariffs on steel and aluminum from Japan, the European Union and elsewhere, the president has sought to bring together a coalition of wealthy democracies to battle China in clean energy. His administration led an effort at the Group of 7 summit last year to outline a harmonized strategy of subsidies to compete with China’s state funding for new technologies.

Many current and former administration officials hope that cooperation will now extend to tariffs as well, starting with Europe, which is conducting its own investigations of Chinese trade practices and appears poised to raise its existing tax rate on imported Chinese electric vehicles.

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