by George Hetling
On March 6, the International Brotherhood of Teamsters endorsed Republican-led legislation to raise base tariffs on imported Chinese vehicles from 2.5% to 100%.
The Teamsters state in their press release, “The proposed legislation would prioritize the American auto industry and American workers, and would be an integral part of the conversation on the economic impacts of Chinese manufacturing, including ongoing efforts of Chinese state-owned enterprises to dominate domestic markets.” The bill’s author Senator Josh Hawley echoes the sentiment, saying “If Joe Biden wants to support American autoworkers, he should start by protecting them from the existential threat posed by China.”
The jingoist language and fear-mongering around China was echoed by US Treasury Secretary Janet Yellen in her visit this month to Beijing, where she complained that China was producing too many Electric vehicles, lithium batteries, and solar energy materials, which would lead to “overcapacity”.
Tariffs are made in order to protect monopolies and their profits in a given market and industry. EV manufacturing requires fewer workers than traditional vehicle manufacturing. This increases the rate of exploitation, thereby driving up profits for automakers. This is true regardless of where the cars are made or what company owns the factories. Tariffs, therefore, cannot protect jobs.
Combined with the Biden Administration’s tax policy that already added a 25% tariff imposed on companies which don’t manufacture a certain percentage of cars inside North America, this bill would raise tariffs on Chinese vehicles to a peak of 125%. Even with these increases, however, the cheap prices of Chinese electric vehicles mean that the cars may remain competitive with the rest of the industry. If passed, this tariff would be another escalation in the US-China trade war. However, such a steep increase in tariffs may not be viable to pass into law.
photo: Teamsters President Sean O’Brien, from the IBT website
