IT’S just about four years since the previous President Donald Trump slapped tariffs of up to 25 per cent on imports from China as part of a trade war. He was convinced that it would redress the US trade imbalance with China and promote American manufacturing. In that respect, the policy has been a failure.

Trump did not understand the multi-faceted nature of international trade flows. The US continues to import far more from China than it exports to it. As well, America’s imports from Vietnam, Malaysia, Thailand, South Korea and Mexico have surged as firms in both the US and in China rearranged their supply networks to circumvent the tariffs. And Beijing’s agreement to increase its purchases of American goods by US$200 billion above 2018 levels has not been met. Indeed, it is now abundantly clear that Trump’s trade war turned out to be an exercise in imposing self-inflicted damage on the US economy.

Now, as required by the law under which the tariffs were imposed, the time has come for the Biden administration to review the taxes. It has to decide to either renew the first tranche of 25 per cent tariffs on US$34 billion of China’s exports to the US or allow them to lapse. Pressure on the administration to act is evenly balanced. One lobby group, the US China Business Council, is pushing for lifting tariffs. It estimates that the trade war has cost 245,000 US jobs so far because the American consumers and importers have absorbed the additional costs. But US trade union representatives have called on US President Joe Biden to keep the tariffs in place because they fear that lifting them would mean job losses as American business and industry again head back to China to do their manufacturing.