A day after his top economic adviser conceded that American companies and consumers would be paying for new tariffs levied on several hundred billion dollars of imports from China, President Donald Trump on Monday defended his latest trade moves against Beijing, as some GOP lawmakers said the tariffs amounted to nothing more than a new tax.
In a series of Monday morning posts on Twitter, President Trump said there was 'no reason' consumers should have to pay higher prices for the Chinese goods, arguing they should seek out imports from other nations, or buy American instead.
On Sunday, the President's top economic adviser acknowledged that President Trump has been wrongly saying that China would be paying for the new import duties - instead, the American companies buying those items would pay the extra tariffs, with billions in extra revenues going to Uncle Sam, and higher costs possibly being passed on to consumers.
"These massive payments go directly to the Treasury of the U.S.," the President acknowledged last week - as the amount of import duties being collected by the U.S. Government should grow even more with the decision to increase tariffs from 10 to 25 percent on some $250 billion in imported Chinese products.
Larry Kudlow admits that the Chinese do not directly pay tariffs on goods coming into the U.S., as Trump has repeatedly, and incorrectly, claimed.— Kyle Griffin (@kylegriffin1) May 12, 2019
Via Fox pic.twitter.com/sbXvfBbktf
The aggressive emphasis by Mr. Trump to levy new tariffs on China, as well as tariffs on imported steel and aluminum has already had a direct impact on Uncle Sam's bottom line, as the amount of import duties collected so far in 2019 is almost double where it was a year ago.
Figures released last Friday by the Treasury Department show through April, the feds have collected $39.3 billion in import duties - that's up from $21.8 billion at the same point in 2018.
For many economists and lawmakers, tariffs are no different than taxes.
"Every time you hear about U.S.-imposed tariffs, remember that they are taxes on Americans," said Rep. Justin Amash (R-MI). "@POTUS is boasting that he loves collecting big taxes on Americans."
"Trump’s tariffs will only lead to higher consumer prices for ordinary Americans," said Rep. Ro Khanna (D-CA).
President Trump last week predicted the latest round of tariffs on Chinese imports would bring in $100 billion to the U.S. Treasury - and that's a red flag for Republicans, who worry it might get in the way of GOP tax cuts.
"I know of a big company that told me that the tax cuts specifically helped them but that the tariffs are almost equal in punishing them," Sen. Rand Paul (R-KY) said on ABC's This Week.
And as more in tariffs are being paid - it also raises the question of whether that will impact consumers.
Goldman Sachs has a simple retort to all those who say Trump’s tariffs aren’t causing consumer prices to go up... pic.twitter.com/PIVmLoUzSx— Shawn Donnan (@sdonnan) May 13, 2019
But the other option to increasing tariffs is one which President Trump repeatedly presses - the decision of buying items made in the U.S. - as the higher cost of imports from other nations would make higher-priced American products more competitive.
It's a protectionist type of argument which runs counter to what the Republican Party has backed for decades.
The Wall Street Journal editorial board last year said, "Mr. Trump may be the first openly protectionist President since Hoover."
“Buyers of product can make it themselves in the USA (ideal), or buy it from non-Tariffed countries,” Mr. Trump tweeted, as all sides will get to watch what happens in coming months in terms of economic impacts, if this trade war continues.
The Treasury Department estimates the U.S. will collect over $69 billion in tariffs in 2019 - up from $41 billion in 2018, and $34.5 billion in 2017.