Election Day 2024: How U.S.-China Tariff Policies Could Shift Based on the Outcome

Election Day Insights: U.S. Tariffs on China – A Comparison of Democratic and Republican Approaches

As Americans head to the polls on Election Day, the outcome will influence much more than just domestic policy. Both major parties, regardless of the winner, are expected to intensify scrutiny on Chinese imports, with new and continued tariffs in the spotlight. Here’s a rundown of how each party's approach could shape U.S.-China trade in the years ahead.

Democratic Approach Under Kamala Harris: Targeted Tariffs and Strategic Continuation

If the Democrats secure victory in 2024 with Kamala Harris as president, her administration is anticipated to follow closely in the footsteps of the Biden administration. Key tariffs on Chinese goods would likely remain in place, with new adjustments intended to protect strategic industries.

Specific Tariff Increases

The current administration has already outlined increased tariffs set to take effect on September 27, 2024. If Harris follows the Biden administration's stance, we can expect:

• 100% tariffs on electric vehicles

• 50% tariffs on solar panels

• 25% tariffs on electric vehicle batteries, essential minerals, steel, aluminum, face masks, and ship-to-shore cranes

These tariffs underscore a strategy focused on safeguarding U.S. industries vital to energy, transportation, and health sectors.

Additional Tariff Plans

Over the next two years, tariffs on semiconductors and additional Chinese imports are expected to rise. In May 2024, the Biden administration doubled tariffs on several goods, including semiconductors and solar cells, to 50%. Harris is likely to continue pushing for similar increases to bolster U.S. competitiveness in critical tech industries.

Continuation of Existing Tariffs

Much of the groundwork laid by previous administrations would remain:

• Substantial tariffs on approximately $300 billion worth of Chinese goods implemented during Trump’s presidency would continue.

• Exemptions on these tariffs could be re-evaluated or allowed to expire, resulting in broader application of the duties.

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Strategic Focus

While Harris has not explicitly detailed her stance on China, her administration is likely to maintain a competitive edge through:

• Investments in 21st-century industries like AI and quantum computing

• Support for renewables, critical materials, semiconductors, and healthcare products to limit reliance on Chinese imports

This approach reflects a bipartisan sentiment to curb China’s influence while strategically bolstering American innovation in sectors seen as pivotal to future economic strength.

Republican Approach Under Donald Trump: Sweeping and Aggressive Tariffs

If the Republicans win and Donald Trump returns to office, expect a bolder tariff strategy. Trump’s proposed tariffs are expansive, covering a broad range of imports in an effort to dramatically reduce trade imbalances with China.

Proposed Tariff Increases

Trump has announced plans to introduce a 10% universal tariff on all U.S. imports, including Chinese goods, with an additional 60% tariff specifically on Chinese imports.

Specific Tariff Proposals

To target China’s automotive industry and preserve American manufacturing, Trump has floated the idea of:

• 200% to 500% tariffs on Chinese electric vehicles manufactured in Mexico

• Potential 100% tariffs on nations that distance themselves from the U.S. dollar in favor of alternative currencies

These steep tariffs highlight a strategy aimed not just at economic gains but at challenging China’s influence over the global economy.

Impact on Existing Tariffs

Trump would likely re-implement and possibly expand the $300 billion worth of tariffs from his previous administration. He may also allow exemptions to lapse, placing further burdens on Chinese imports.

Strategic Focus

Trump’s broader vision involves:

• Targeting a wide range of Chinese goods to bring down the U.S. trade deficit

• Pressuring China for concessions on trade practices, intellectual property, and currency manipulation

• Using tariffs as a bargaining chip for larger geopolitical negotiations

While these measures reflect Trump’s stated intentions, implementing such widespread tariffs would face significant challenges, including possible retaliation from China, domestic resistance, and potential economic impacts on U.S. businesses and consumers.

What Does This Mean for U.S.-China Trade Relations?

Both parties’ approaches aim to address trade imbalances with China but differ significantly in scope and intensity. The Democratic approach under Harris would likely continue Biden’s targeted tariffs, focusing on specific industries and strategic sectors. This would allow for a gradual, structured approach, less likely to disrupt current trade relationships.

In contrast, the Republican approach under Trump proposes extensive tariffs across the board. While this may appeal to domestic manufacturing interests, it risks heightened consumer costs, trade tensions, and potential blowback on the U.S. economy. Trump's aggressive plan could also lead to significant price increases on everyday items for American consumers.

In Summary

Regardless of who wins the 2024 presidential election, the U.S. stance on trade with China is set to remain strict. The difference lies in how extensively each party would employ tariffs to achieve their goals. Harris’s administration would likely focus on securing the U.S. position in strategic sectors, while Trump would pursue a more sweeping, intense approach to decouple from Chinese imports.

As the election results unfold, businesses and consumers alike should keep a close eye on how the next president will influence U.S.-China trade and consider the potential impacts on the global economy.