Tariffs are Bad for America

By Rachel Burger|Opinion|1 Comment

The Smoot-Hawley Tariff fiasco may repeat itself if Congress passes the Currency Exchange Rate Oversight Reform Act. The act aims to punish China for manipulating its currency, slapping painful tariffs on imported Chinese goods.

At first glance, the idea seems solid: the United States is in a recession, China is stealing American jobs, therefore making Chinese goods more expensive will bring jobs home to the United States. Unfortunately, in practice this would not be the case. Globalization is here to stay; if United States companies can’t import cheap goods from China, they will find other countries (like Laos or Vietnam) to fill China’s shoes. In addition, the effects of the tariffs will fall heavier on the consumer than on the corporations themselves. In a country where so many people rely on companies like Walmart to get the cheapest prices to feed their families, the Currency Exchange Rate Oversight Reform Act will only hurt Americans.

The greater question is: is China’s manipulated currency a threat to the United States? When I studied at Peking University under Qingmin Zhang, he argued that while currency manipulation is a threat to the United States in the long run, there are far more pressing issues. I tend to agree with him; the United States should be focusing on cyber-security, North Korean-Chinese relations, and China’s increasing military might. As of now, currency manipulation should not be the United States’ top concern. Do not pass the Currency Exchange Rate Oversight Reform Act.