All had been so calm and quiet on the tariff wars front, right up until this past weekend when President Donald Trump unleashed a short but to-the-point tweet storm that addressed the current situation between the U.S. and China. In short, the countries have been having “productive” negotiations as they work towards a trade agreement. But, according to the president, those negotiations are happening too slowly. As such, Trump said that the new deadline for a deal—which was postponed “indefinitely” back in February—is now this Friday, May 10.
If that deadline comes and goes without a new deal, some $200 billion in goods that currently face a 10 percent tariff will see that rate rise to 25 percent.
....of additional goods sent to us by China remain untaxed, but will be shortly, at a rate of 25%. The Tariffs paid to the USA have had little impact on product cost, mostly borne by China. The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!
— Donald J. Trump (@realDonaldTrump) May 5, 2019
That rush to set a new deadline, along with the president’s positing that tariffs had little impact on product cost, did not sit well with retailers.
David French, the senior vice president for government relations for the National Retail Federation, essentially called the president’s statement wildly misleading.
“Tariffs are taxes paid by American businesses and consumers, not by China,” French said in a statement over the weekend. “A sudden tariff increase with less than a week’s notice would severely disrupt U.S. businesses, especially small companies that have limited resources to mitigate the impact. If the administration follows through on this threat, American consumers will face higher prices and U.S. jobs will be lost.”
NRF cited a report from Trade Partnership that found an increase of the tariff rate to 25 percent on $200 billion worth of goods from China—which is what the president has suggested will happen—coupled with the tariffs already in place, would reduce U.S. employment by more than 934,000 jobs, cost the average family $767, and reduce the U.S. GDP by 0.37 percent.
“We want to see meaningful changes in China’s trade practices, but it makes no sense to punish Americans as a negotiating tactic,” French said. “If the administration wants to put more pressure on China, it should form a multinational coalition with our allies who share our concerns. We urge the administration to reconsider this tax hike on Americans and stay at the bargaining table until a deal is reached.”