 | By John Guida Staff Editor, Opinion |
At a time when most of what we're hearing about U.S. trade policy with China has focused, from the left and the right, on beefing up U.S. industrial policy, here's a voice that insists we should not overlook the value of tariffs as well. |
In a guest essay today, Robert Lighthizer — the U.S. trade representative under President Donald Trump and a deputy trade representative under President Ronald Reagan — argues that in the economic competition between China and America, Beijing is using all of the tools available to an authoritarian government to overtake us, and that the United States must use all those in a free democratic system, including tariffs, to win. |
In a brief Q. and A., I dug into this with him a bit further — particularly his experiences in the Trump and Reagan administrations. He offered a few more thoughts on why tariffs are a key lever for the United States in competing with China. |
John Guida: Could you, in a couple of sentences, explain why you think tariffs are an important tool of economic policy? |
Robert Lighthizer: Tariffs are extremely important. First, they are a legitimate source of revenue to help pay for government programs. Those who sell in the United States should contribute to paying the bills. Second, they can be effective in offsetting the unfair advantage of other countries' industrial policies and unfair practices. Why should American workers pay the price for other countries' cheating? Third, tariffs can be an effective part of our own industrial policy: They can be used to encourage domestic production of needed products (like P.P.E.). Finally, tariffs can be used as leverage to open other countries' markets to American exports. |
JG: Are there one or two things from your time as trade representative in the Trump administration that you think are applicable to what's going on now with regards to China policy? |
RL: President Trump really changed the way most people in our country think about China. He got us to see them not as a benign partner but as an adversary that wants to be number one in the world. Putting in place tariffs on $370 billion of China's exports and obtaining the Phase One economic and trade agreement signaled the most significant economic and foreign policy change in a generation. Coupled with export control improvements, investment restrictions and other measures, the Trump administration had a policy of serious engagement. So far the Biden administration has maintained these policies, and I'm pleased that they have. |
JG: You served in the Reagan administration as deputy trade representative. The primary competition then was with Japan. How was that similar to and different from America's competition with China today? |
RL: Engaging on the issue of Japanese industrial policy was a great achievement of the Reagan administration. Many sectors — from automobiles to steel to semiconductors — were under assault and it was not fair trade. Though he was roundly criticized by free traders and globalists, President Reagan rose to the occasion to protect American jobs and industries. |
But there was a major difference. Japan was our close ally. They wanted to advance but they needed us to succeed, too. That is critical. |
Here's what we're focusing on today: |
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