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September 25, 2018

U.S. Consumers Continue to Lose in Escalating China Trade War

 
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Amid rising tensions in U.S.-China trade, IPI resident scholar Dr. Merrill Matthews joined CGTN America’s The Heat, noting that China’s retaliatory tariffs are indeed highly targeted toward likely supporters of President Trump, while the U.S.-imposed tariffs are hammering all American consumers and the opposite of “draining the swamp.”

“Higher prices are coming and some are already here,” said Matthews. “And some of Trump’s biggest defenders are taking the hit on this,” citing the fishing and agricultural industries in particular.

Matthews added: “If the [trade war] pushes up prices, it encourages the Fed to raise interest rates, which creates more problems.”

Host Mike Walters asked Matthews about speculation that China’s recent tariffs on U.S. goods were specifically targeted at President Trump’s political base.

“There’s widespread opinion that whereas Donald Trump threw haphazard tariffs on steel, etc., the Chinese were much more strategic,” said Matthews, noting that the new duties on products such as salted beef, pig casings, frozen peas and canned spinach hit the Midwest region particularly hard.

“Trump wanted to drain the swamp in Washington,” added Matthews. “But now thousands of companies have filed for an exemption from tariffs through the Commerce Department. It is the definition of the swamp.”

Quoting a recent tweet, Matthews observed how the president thinks that with more tariffs going into effect, more revenue is generated for U.S. coffers. “I thought to myself, ‘Do you understand that revenue is coming from U.S. consumers?’ He often speaks as though this actually hammers people in other countries, but the tariffs are actually taxes on us.”

Watch the full video here




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