Why you're going to be hearing a lot about tariffs on China for the next 4 months

• Trump picked Senator JD Vance as his running mate, shedding more light on his policy platform.

• Both Trump and Vance have supported strong tariffs on China to promote domestic manufacturing.

• Biden, and some economists, said Trump's tariff policies would raise prices for consumers.

Former President Donald Trump has finally announced his running mate — and his choice means you'll hear a lot about tariffs on China in the coming months.

On Monday, Trump announced that JD Vance — a Republican senator from Ohio — is his pick for vice president. Vance, who previously described himself as a "Never Trump Republican," quickly aligned himself with Trump and GOP values once he took office in January 2023, embracing conservative views on issues including higher education, immigration, and tariffs.

The latter is an issue on which Vance and Trump particularly agree. Tariffs, or taxes on goods imported from another country, are intended to raise government revenue and bolster domestic manufacturing. As president, Trump was staunchly protectionist and used tariffs to enforce his "America First" policies — he imposed a series of tariffs on China that ultimately led to a trade war between the two economies resulting from disagreements over the tariffs.

Should Trump secure a second term, Americans will likely see a lot more action on that front. Vance has previously advocated for tougher trade policies against China, telling CBS News in May that "if you apply tariffs, really what it is is you're saying that we're gonna penalize you for using slave labor in China and importing that stuff in the United States."

"What you end up doing is you end up making more stuff in America, in Pennsylvania, in Ohio and in Michigan," he said.

While Trump touted his tariffs as necessary to promote manufacturing in the US, a major consequence of those actions was raising prices for Americans due to less competition from foreign producers. According to the Tax Foundation, Trump's tariffs raised taxes by nearly $80 billion.

While President Joe Biden has kept most of Trump's tariff policies in place — in May, he announced an $18 billion tariff increase on Chinese goods, which increased taxes by $3.6 billion — Trump has even more planned in his new platform.

It means voters are likely to hear the two candidates sparring over trade policy in the months to come — and it could have significant implications for Americans already struggling with high inflation.

"I certainly agree that we need to apply some broad based tariffs, especially on goods coming in from China and not just solar panels and EV stuff," Vance told CBS. "We need to protect American industries from all of the competition."

Trump vs. Biden on tariffs

Should Trump win the election, he wants to impose a 10% tariff on goods coming into the US and a 60% tariff on all imports from China.

Biden criticized that policy during the first presidential debate at the end of June, saying that Trump is "calling for a 10% tariff on everything Americans buy, including food from overseas, vegetables and other necessities."

"Economists tell us that that would cost the average American working family another $2,500 a year," Biden said. While estimates have varied on the exact impact of the tariff increase on American families, 16 Nobel Prize-winning economists signed a letter at the end of June saying they are "deeply concerned" about the impact of Trump's policies on the economy.

"Those tariffs overwhelmingly get passed on to consumers and increasing their prices and get fed down the supply chain — again, increasing prices to consumers," Joseph Stiglitz, who led the letter, previously told BI.

Biden's tariff policies have been more targeted than Trump's. In May, he called for tariffs on electric vehicles, steel, and aluminum coming from China and an increase in the tariff rate on semiconductors from 25% to 50% in 2025.

Both candidates have advocated tariffs and promoting domestic manufacturing, but Trump and Vance are set to act much stronger on the issue should they win — meaning consumers might be on track for even higher prices as a result.

Read the original article on Business Insider