Economic hardship has defined much of the past year for countless businesses across the United States. The COVID-19 pandemic, which forced unprecedented shutdowns and posed new, unfamiliar challenges, has placed a considerable burden on businesses both large and small. Unfortunately, though, for many businesses this year’s recession only exacerbated what has been a difficult few years thanks to costly tariffs and ongoing trade wars.
Beginning in 2018, the Trump Administration levied a wide range of new tariffs on goods imported from China, claiming that they would help to level the playing field for American businesses and entrepreneurs. However, the truth is that tariffs are taxes paid by American businesses to the federal government. The end result of the trade war has been higher operating costs for businesses, higher costs of products for consumers, and billions less in the pockets of Americans as key job-creating industries like manufacturing have struggled to keep up with the costs of the tariffs.
As a result of the trade war, many businesses relocated their operations elsewhere in Asia, with Vietnam being one of the primary destinations. Now, however, those businesses find themselves at risk yet again, as the Office of the U.S. Trade Representative (USTR) recently announced it was launching an investigation into Vietnam for its trade practices and potential currency manipulation. Based on the findings of this investigation, USTR Robert Lighthizer may decide to impose tariffs on imports from Vietnam similar to those already on Chinese goods rather than enter into negotiations with Vietnam to address its practices.
Implementing new tariffs in spite of the damage that existing tariffs have already done to American businesses and consumers would be the wrong move to make. These tariffs are not paid by other countries like Vietnam or China, they are paid by us right here in the U.S. Whenever they are levied on new imports, those costs fall on Americans, and weigh down our economy and undermine our competitiveness.
It is not just one industry that has borne the burden of these tariffs, either. Farmers throughout the nation have lost some of their largest purchasers abroad since the trade war began, while countless small businesses have found it more difficult to acquire the goods they need to operate successfully. Manufacturing, too, has experienced a drastic slowdown as the industry continues to be subject to additional tariffs. As costs go up for these businesses, they also go up for consumers, severely restricting their capacity to get through what is quickly becoming one of the worst economic crises in recent times.
Americans are already struggling to get by during the pandemic, with unemployment remaining unsustainably high and the economy only recovering gradually. New tariffs on Vietnamese goods would only make it more difficult for businesses and the Americans who rely on them to get back on their feet and would put the country’s long-term economic health in greater jeopardy. In order to best help American citizens heading into the new year, USTR Robert Lighthizer and his colleagues in the Trump Administration must avoid implementing any sort of new tariffs.
Engaging in yet another trade conflict will not protect American interests, it will put them at greater risk, and Ambassador Lighthizer should act accordingly. As the specter of more tariffs and prolonged trade conflicts rears its head, our elected leaders must recognize that implementing new duties on Vietnamese goods in addition to those currently on Chinese imports and goods from other nations will only further disrupt an already fragile economic recovery, and make it more difficult for American families to weather this pandemic.
Jesse Grady formerly served as a Regional Field Director for the Texas GOP and served as a staffer on the Donald Trump presidential campaign in 2016.