The Impact of the China Shock and Trade Wars on Economies

This week, President Biden announced major new tariffs on $18 billion worth of imports from China. The goods that will be affected include batteries, steel, aluminum, and semiconductors. Tariffs on electric vehicles will go up from 

25 percent to 100 percent. These new tariffs signal a reversal from Biden’s messaging on tariffs during the 2020 campaign, and also a reversal of a decades-long consensus in Washington that lower tariffs are better for the American economy. To understand how we got here, Micah spoke with Gordon Hanson, an economist and a co-director of the Reimagining the Economy Project at Harvard University’s Kennedy School.

Further reading:

• Help for the Heartland? The Employment and Electoral Effects of the Trump Tariffs in the United States
• Washington’s New Trade Consensus

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