Thursday, July 28, 2005

Senators going ahead with the Tariff plan

Great, looks like Lindsey Graham and Chuck Schumer are going through with the bill that is going to impose 27.5% tariffs on Chinese goods. The Chinese already made a token move to revalue the Yuan but they look like they are going to stop doing it.

But imposing some insane tariff on *all* Chinese goods is not the way to fight back. A trade war is not something the US needs now. Also the WTO will strike this down so fast it will make your head spin. Rattling the sabre like this will only make many goods more expensive when Americans are groaning under high gas prices.

Both Snow and Greenspan are trying to talk these guys down. Let's hope these measures are defeated before they get any traction. A 27% raise in tariff will be like a 27% raise in taxes on regular working Americans that buy lots Chinese goods. In other words anyone who shops at Wal-Mart, Best Buy, JC Penny etc.

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