The trade war between the United States and China continued this week with the latest salvo – a move that came amid a hot race for the White House.
On Tuesday, US President Joe Biden announced tariff increases on imports of various Chinese goods worth $18 billion.
Lithium-ion batteries account for $13 billion of total imports, while certain steel and aluminum products, as well as items such as gloves and medical syringes, make up the remaining $5 billion.
Experts say tariffs on these products will likely have a limited impact on consumer prices and economic growth. They argue that a greater advantage may lie at the ballot box as Biden seeks a second term in the White House.
“These tariffs are very marginal and the impact on the economy will be the result of a rounding error,” Bernard Yaros, chief U.S. economist at Oxford Economics, told Al Jazeera.
While tariffs don’t change much for the U.S. economy, it’s still “good policy,” especially in an election year, Yaros added.
Power projection
The U.S. will hold presidential elections in November, and Biden is expected to face his predecessor, former Republican President Donald Trump, in a tight race.
Trump has long sought to project a tough-guy image, particularly on foreign policy and the economy, while labeling his Democratic rival as “weak.” But Biden has sought to deflect that criticism by imposing policies that in some cases build on Trump’s.
A January paper (PDF) from the National Bureau of Economic Research concluded that tariffs may have political benefits even if they do not translate into “significant job gains.”
The article covers the period from 2018 to 2019 when Trump imposed stiff tariffs on China and other countries, targeting products such as aluminum, washing machines and solar panels.
They found that residents of US regions that were more exposed to import tariffs were less likely to identify as Democrats and more likely to vote Republican.
The report said voters “responded favorably” to the tariffs “despite their economic costs,” which came in the form of retaliatory tariffs from China.
“Tariffs are good policy, even if the economics don’t work,” Yaros said.
Appeal to the Rust Belt
Biden and Trump are in a neck-and-neck race, with some polls showing the Republican candidate ahead of the incumbent in key swing states.
Clik here to view.
For example, a poll conducted this week by the New York Times, Siena College and the Philadelphia Inquirer found Trump with an advantage in key states such as Arizona, Nevada and Georgia.
Biden appeared in one of those states, Pennsylvania, last month to announce his intention to triple tariffs on Chinese steel. Pennsylvania is part of the Rust Belt, a region historically known for its industry, and the state is famous for its steel production.
Brad Setser, a senior fellow at the Council on Foreign Relations, said Biden is also trying to protect other U.S. industries, such as the growing electric vehicle (EV) sector.
His new trade rules will ensure that the United States cannot directly import electric vehicles made in China, Setser explained.
He added that China has built a competitive electric vehicle industry on deep government subsidies and could flood the global and U.S. markets with cheap cars if it didn’t do so.
“China, with its significant automotive needs, has provided a lot of subsidies to its electric vehicle industry, which has led to this strength,” Setser said.
“It must recognize that the United States and Europe will use some of these techniques (subsidies and tariffs) to build their own industries. It is unrealistic for China to object to other countries doing the same.”
Protecting the US auto industry will also help Biden in the polls. Historically, the sector is concentrated in Michigan, another key swing state where Biden has recently faced fierce opposition.
Michigan is the birthplace of the “unaligned” movement, which encouraged Democrats to refrain from voting for Biden in the primary and instead cast their ballots for the “unaligned” option.
The protest was seen as part of a broader, largely progressive response to Biden’s unwavering support for Israel’s war in Gaza.
Looking ahead to November
But experts who spoke to Al Jazeera questioned whether Biden’s newly announced tariffs would move the needle in the election.
According to the U.S. Census Bureau, in 2023, the United States imported $427 billion worth of goods from China but in return only exported $148 billion to the country.
This trade gap has persisted for decades and is becoming an increasingly sensitive topic in Washington, especially as China competes with the U.S. to be the world’s largest economy.
While transpacific trade has benefited both countries – providing cheap goods for American consumers and a large market for Chinese manufacturers – it remains a contentious issue, especially during elections, because of the history of American manufacturing jobs moving overseas.
U.S. politicians have also expressed privacy concerns about Chinese technology entering the North American market.
While China has promised retaliation for the latest round of tariffs, experts say it will likely be symbolic because the U.S. tariffs themselves are highly targeted.
“We do not assume that the retaliation will be of any destructive nature,” Yaros said. “They won’t raise the rate. This has not been their modus operandi in the past when the United States imposed tariffs.