The Trade War Begins: U.S. and China Tariffs Take Effect
*By Alisha Haridasani*
It’s happening.
A fierce trade war between two of the world’s largest economies set off early Friday, after the U.S. officially implemented tariffs on $34 billion worth of Chinese goods and Beijing immediately responded in kind.
President Donald Trump warned on Thursday, before the tariffs went into effect, that the U.S. could end up taxing every single Chinese item imported if Beijing retaliates. That would be worth $500 billion.
China, however, didn’t blink and blamed the U.S. for launching “the biggest trade war in economic history so far.”
While U.S. markets didn’t seem to react to the news at the open, the impact of the economic tit-for-tat will likely sweep across corporate supply chains in both America and China, weighing down bottom lines and consumer wallets.
“It’s becoming conventional wisdom at this point that the benefits of corporate tax cuts is being offset by the uncertainty around the trade war,” said Axios reporter Erica Pandey.
“We can see impacts as small as a small price hike for consumers, or the businesses could choose to eat the costs and we could see losses of jobs.”
The Trump administration’s tariffs specifically target high-tech products in an attempt to punish China for intellectual property theft. That could have knock-on effect on [millennial consumers](https://cheddar.com/videos/how-the-trade-war-will-affect-millennials), said Pandey.
“Some of the goods on the chopping block include e-bikes, e-scooters, e-cigs, and everything ‘e,’ and smart home devices,” said Pandey. “So it’s the tech devices that are overwhelmingly used by young people that are not often discussed but that could go up as much as $100 per unit with these new tariffs.”
China’s tariffs target America’s agricultural industry, hitting soybeans, poultry, corn, wheat, rice, and beef, with the intention of crippling farmers’ support for Trump.
One slice of the agricultural industry is already feeling the pinch: [cheese producers](https://cheddar.com/videos/u-s-cheese-producers-in-crossfire-of-trade-war). American cheese makers in recent years have relied heavily on exports to Mexico and China, both countries that have now levied retaliatory taxes on the dairy product, said Wall Street Journal reporter Heather Haddon.
Before the tariffs kicked in, dairy exports had hit a record high in April, doubling from nearly a decade ago, according to Haddon's reporting.
With the new trade barriers in place, cheese makers are struggling to find a market for their products. "They can't just take this cheese that was made for Mexico and then just and sell it to folks in North Carolina or wherever," said Haddon.
"At the same time we've got record high cheese in storage right now. There's quite a lot of supply in the U.S. so it's also not like the supply can just go domestically."
Adding to the cheese makers problems are the perishable nature of their product, which would only compound their losses.
"Some of them are starting to contemplate shifting to cheeses that can be held for longer, that can be aged, that benefit from ageing, if this tariff situation continues."
Nancy Pelosi and House Democratic leaders are now planning to amend the stop trading on congressional knowledge act, otherwise known as the 'Stock' Act. This 2012 law governs how members disclose the purchase or sale of stocks and amending it would close a loophole, eliminating the trading of individual stocks by members of congress. Pelosi has consistently opposed a ban on stock trading by lawmakers and congressional staff...so what's changed? Kedric Payne, Vice President of Campaign Legal Center, joins Cheddar News to discuss.
In a 5-4 vote, the U.S. Supreme Court allowed for a controversial new version of the Alabama congressional map to remain in place. The lower court had previously ordered that the state must redraw that congressional map because it violates the Voting Rights Act by diluting the political power of Black voters. Redistricting expert Yurij Rudensky joins Cheddar News to weigh in.
Florida lawmakers have introduced a controversial bill restricting some discussion of sexual orientation and gender identity in classrooms with young students. Supporters say the move empowers parents to have more of a say in what their children learn. Florida State Senator Shevrin Jones joins Cheddar News to discuss more.
Congress this week passed a bill that would end forced arbitration for workplace sexual assault and harassment, one of the most significant changes to employment law in years. Cheddar News speaks with Marjorie Mesidor, Sexual Harassment Attorney, who explains that arbitrators are often retired judges or attorneys who "tends to have a more conservative view both to law and rewards."
As the situation with Russia has grown more precarious, the White House urged Americans remaining in Ukraine to leave immediately. The Biden administration that it sees continuing signs of escalation but did not have specific information detailing a timetable for a potential invasion. Kristine Berzina, senior fellow and head of the geopolitics team at the Alliance for Securing Democracy, joined Cheddar News to provide her analysis. "There's talk of an impending phone call between President Putin, President Biden," Berzina said. "That is certainly a good sign to indicate that there would be significant cost."
Terrell Starr, host of 'Black Diplomats' podcast and senior nonresident fellow at the Eurasia Center for Atlantic Council, joins Cheddar News from Kyiv, Ukraine to discuss the mounting tension there.
The White House laid out plans for a $5 billion investment into a national network of charging stations to ease EV driving anxiety. Bruce Brimacombe, CEO of EV infrastructure GOe3 joined Cheddar News to discuss how much needs to be done for drivers to get over the fear of running out of energy. "People need to be able to do what they're doing now," he said. "But that is the way that if you're going to buy an electric car, you got to feel like you're not changing your world." Brimacombe noted that building out the infrastructure between cities was GOe3's own focus.
U.S. automakers are saying that the blockade of the Ambassador Bridge, a crucial border crossing between the U.S. and Canada, is affecting their production lines. Michelle Krebs of Cox Automotive warns that the disruption "couldn't come at a worst time," amid chip and labor shortages in Detroit.
AND DETROIT-BASED AUTO MAKERS SAY THEY ARE SHUTTING DOWN PLANTS OR SCALING BACK PRODUCTION BECAUSE OF PARTS SHORTAGES.
Plans to add affordable housing to a development in Yellow Springs, Ohio, were squashed after comedian Dave Chappelle and other community members spoke out against the project. Chappelle threatened to pull the plug on his local comedy club and restaurant projects if the development had been approved.
