Will he or won’t he?

Facing the highest price hikes in 40 years, President Joe Biden is deciding whether to roll back some of the tariffs that former President Donald J. Trump imposed on Chinese goods, including fasteners, in 2018, senior administration officials told the New York Times. 

Four years ago, the Trump administration placed 10% tariffs on bolts, screws and other fasteners (HTS subheadings 7318.11.00 to 7318.29.00) manufactured in China, and on all Chinese iron and steel nuts (HTS subheading 7318.16.00).  Those tariffs were hiked to 25% the following year.

The tariffs include 25% duties on bolts, screws and other fasteners (HTS subheadings 7318.11.00 to 7318.29.00) manufactured in China and 15% on all Chinese iron and steel nuts (HTS subheading 7318.16.00).

China retaliated with matching tariffs on an equal amount of U.S. goods, embracing the largest trade war with the West in decades.

Now Biden may end some of the tariffs in an attempt to mitigate some of the price pain shattering U.S. consumer confidence and “(driving) stock markets into bear territory” as economists warn about a possible recession.

“The China tariffs are raising the price of goods for American consumers by essentially adding a tax on top of what they already pay for imported goods,” according to the Times.  “In theory, removing the tariffs could reduce inflation if companies cut — or stopped raising — prices on those products.”

Tweaking the tariffs could “encourage companies to keep their supply chains in China.”

China has yet to live up to the commitments it made as part of the U.S.-China trade deal that Trump negotiated, including failing to purchase significant amounts of natural gas, Boeing airplanes and other American products.  Four years later, the U.S. retains a 25% tariff on about $160 billion of Chinese products, while another $105 billion of consumer goods are taxed at 7.5%.

In 2020, the World Trade Organization (WTO) ruled the tariffs violate international trade regulations and urged the U.S. to rescind the measures.

Yet the tariffs remain in place, embraced by the Biden administration as “leverage” over China’s unfair trade practices.

In March, economists at the Peterson Institute for International Economics released a report detailing how removing tariffs “could cause a one-time reduction in the Consumer Price Index of 1.3 percentage points, amounting to a gain of $797 per American household.”

The tariffs were issued under Section 301 of the Trade Act of 1974, which allows the White House to fight foreign trade policy it deems “unreasonable or discriminatory and burdens or restricts United States commerce.”

While the tariffs led to higher commercial and retail prices, that burden seemed more bearable in previous years when a strong U.S. economy faced few headwinds.  But the pandemic prompted supply shortages and shipping delays that hiked prices further, adding costs that continue to climb amid strong inflation.

The Office of the U.S. Trade Representative (USTR) list includes:
7318.11.00 – Iron or steel, coach screws
7318.12.00 – Iron or steel, wood screws (o/than coach screws)
7318.13.00 – Iron or steel, screw hooks and screw rings
7318.14.10 – Iron or steel, self-tapping screws, w/shanks or threads less than 6 mm in diameter
7318.14.50 – Iron or steel, self-tapping screws, w/shanks or threads 6 mm or more in diameter
7318.15.20 – Iron or steel, bolts and bolts & their nuts or washers, imported in the same shipment
7318.15.40 – Iron or steel, machine screws (o/than cap screws), 9.5 mm or more in length and 3.2 mm in diameter
7318.15.50 – Iron or steel, threaded studs
7318.15.60 – Iron or steel, screws and bolts, nesoi, having shanks or threads less than 6 mm in diameter
7318.15.80 – Iron or steel, screws and bolts, nesoi, having shanks or threads 6 mm or more in diameter
7318.19.00 – Iron or steel, threaded articles similar to screws, bolts, nuts, coach screws & screw hooks, nesoi
7318.21.00 – Iron or steel, spring washers and other lock washers
7318.22.00 – Iron or steel, washers (o/than spring washers and other lock washers)
7318.23.00 – Iron or steel, rivets
7318.24.00 – Iron or steel, cotters and cotter pins
7318.29.00 – Iron or steel, nonthreaded articles similar to rivets, cotters, cotter pins, washers and spring washers