Some 19 months ago, President Donald Trump declared, “Trade wars are good, and easy to win.” While it’s unlikely many people other than the president believed that, time has reinforced the fallacy of the statement. The United States’ ongoing trade war with China continues to negatively impact producers, exporters and consumers throughout Washington and the rest of the nation.
Frankly, we are tired of all the winning.
“Washington’s ports are gateways to the rest of the world,” Lori Otto Punke, president of the Washington Council on International Trade, said this month. “While we should absolutely be working to level the playing field for U.S. goods and services in markets around the world, the current tariff-first strategy is creating significant harm to our exporters, particularly among our farmers, seafood, and agriculture producers like potatoes, hay, salmon, cherries, and fresh crab.”
The Washington Council on International Trade, in conjunction with several major ports along the West Coast, sent a letter to the president detailing the impact of the trade war. Among them: Wheat exports to China from ports along the Columbia River “have nearly ceased this year,” and exports of soybeans from California ports have declined 97 percent.
That has followed the imposition of retaliatory tariffs by China in the wake of Trump’s tariffs upon goods from that nation. When China increases tariffs, it increases the cost to Chinese consumers and leads them to look elsewhere for desired goods. When those markets dry up, it hurts U.S. producers and those who work along the supply chain, including at ports; an estimated 40 percent of Washington jobs are tied to trade.
Experts warn that recovering those markets will be difficult if not impossible, as Chinese vendors establish relationships with suppliers from other countries.
Americans directly impacted by disappearing Chinese markets are not the only ones affected by the trade war. The latest report from free-trade advocacy groups Tariffs Hurt the Heartland and the Trade Partnership estimates that U.S. businesses and consumers have paid $34 billion in tariffs on Chinese goods since February 2018. “Business leaders and economists across the country agree the trade war is seriously damaging our economy,” said Jonathan Gold of Tariffs Hurt the Heartland.
Trump has frequently claimed that Chinese companies are paying for those tariffs. In truth, the costs are passed along to American consumers, or businesses that import raw material from China. A new round of tariffs imposed last month — mostly on direct consumer goods — will cost the average American family $460 a year, according to a study from two London colleges.
Trump also has claimed that the Chinese economy is reeling and that Chinese officials are bound to acquiesce. In truth, harming the world’s second largest economy negatively impacts markets across the globe and is not something to celebrate.
All of this arose out of a desire to hold Chinese companies accountable for what the president considers unfair trade practices and for the theft of intellectual property. Indeed, such accountability is necessary, but the United States would have more leverage had Trump not abandoned the Trans-Pacific Partnership — an agreement between 12 Pacific Rim nations, not including China.
Instead, Washington consumers, producers and exporters are left only with proof that trade wars are neither good nor easy to win. It has been an expensive lesson.