Biden Says He’s Weighing Tariff Cuts to Fight High Inflation
President Joe Biden said he and his advisers are weighing whether to cut US tariffs on foreign imports to try to fight inflation.
“We’re discussing that right now,” he told reporters Tuesday after a speech on rising prices at the White House. “We’re looking at what would have the most positive impact.”
The president added that no decision has yet been made on how to proceed.
Biden has maintained most of the tariffs imposed by his predecessor, Donald Trump, including duties on more than $300 billion in Chinese imports. But the president has come under pressure from some economists and lawmakers and the US Chamber of Commerce to reduce or eliminate the tariffs with inflation running at the hottest pace in four decades.
Last week, the Biden administration notified about 600 representatives of US industries that have benefited from the China tariffs that they will begin to expire in July, inviting the businesses to request the government keep the duties in place. Any request for continuation would trigger a review of the tariff by the US Trade Representative, during which the duty remains in effect.
The Biden administration in March announced plans to reinstate exemptions from the Trump era on about two-thirds of Chinese products that were previously granted waivers from tariffs, most of which expired by the end of 2020.
Source: Bloomberg
Tai Criticized
US Trade Representative Katherine Tai was criticized by both parties this week for not being ambitious enough in formulating US trade policy. They also felt like Tai had not done enough to consult them on the matter.
The bipartisan group of 24 senators wrote a letter to Tai and Agriculture Secretary Tom Vilsack stating that the Biden administration is not creating enough market access commitments with trading partners. They continued on to say that this lack of ambition “jeopardizes America’s competitiveness, resilience, and security in the long term.” This puts US exporters at a competitive disadvantage in the global market.
Facts Over Feelings
On top of that, Tai indicated that free trade agreements are “relics of the past”, leaving the senators baffled. FTA’s have provided greater market access opportunities over the last 2 decades, have created more high-paying jobs and have allowed lower-cost goods to become more accessible for consumers.
World trade won't stop until the US figures out what they want to do and that will cause US companies to continue to lose ground to competitors in foreign markets.
Although Tai has received backlash, will the US Trade Representative do anything about it?
Source: ST&R
Keeping Strong
Although some shippers are trying to consolidate more partial shipments into truckloads, that hasn’t affected the business of large US less-than-truckload carriers (LTL) companies.
In fact, LTL companies can’t keep up with the demand. Industrial and retail demands are growing at a faster rate than the carriers can add capacity.
The existing network of terminals are nearly maxed out so adding more trucks and drivers won’t help move the goods leaving LTL carriers in a very strong position.
You know where this is headed, right?
There was an 11-12% rate increase in LTL renewal contracts which means that shipping rates are going to go up and there will be delays in shipments. Again.
Source: JOC