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“These tariffs increase the cost of many goods that American consumers buy,” Cohn told CNN.

Cohn, now vice president of IBM (IBM)is a strong advocate of free trade and has frequently clashed with Trump officials who favored tariffs.

“Overall, some tariffs make sense. But a lot of them just act like a consumption tax,” he said.

Cohn, a former top Goldman Sachs executive, announced his departure from the Trump administration in March 2018 after Trump pledged to impose tariffs on steel and aluminum.

“There are a variety of views on trade. My view on trade is quite simple. If we make something here in the United States, we have to protect our makers,” Cohn told CNN. “If we’re not making something here in the United States, and we’re not going to make something here in the United States, I don’t think we should put a tariff on it.”

Won’t solve inflation

Biden said on Tuesday he plans to speak to Chinese President Xi Jinping as the US president considers easing some tariffs on China. Treasury Secretary Janet Yellen said some of these tariffs were hurting families and businesses.

“If you get rid of those tariffs, the price of those goods should go down,” Cohn said.

He conceded, however, that it will not be a panacea for inflation, which unexpectedly worsened in May.

“Nothing will solve inflation. We have to do as much as we can to try to bring prices down,” he said.

Ex-Trump adviser calls for Trump’s China tariffs to be lifted

Of course, there are bipartisan concerns about China’s trade practices. Removing tariffs could undermine efforts to address issues such as intellectual property theft, illegal subsidies and the dumping of cheap goods in foreign markets.

Not to mention the fact that China has not honored the Phase 1 trade agreement signed at the beginning of 2020. China only bought 57% of American exports of goods and services over the period 2020-2021 in which it committed to the agreement, according to estimates. from the Peterson Institute for International Economics.

When asked if the tariff cut would reward China for failing to live up to its end of the deal, Cohn fired back.

“Are we rewarding China? Are we rewarding American citizens because they’re going to buy these goods no matter what and we’re taking more disposable income away from them,” Cohn said.

“Control our own destiny”

Beyond cutting tariffs, Cohn urged lawmakers to fight inflation by investing in U.S. supply chains. Specifically, he called on Congress to pass the Bipartisan Innovation Act, legislation championed by the White House that would invest in domestic computer chip manufacturing.

“Clearly, microchips and computer chips are now the crucial limiting factor that goes into so many goods that we all need as American consumers. It affects us in almost every aspect of our daily lives,” said Cohn. “It starts with country security and military equipment, all the way to our everyday devices that we have on our counters and everything in between.”

The shortage of computer chips has derailed car production, driving up prices for new and used cars and contributing to the current high inflation.

Cohn noted that the United States depends on Taiwan and China for the vast majority of its high-end computer chips, including the semiconductors that go into weapons systems and aircraft.

“We need to bring manufacturing back here to the United States so we can control our own supply chain and we can control our own destiny,” Cohn said.

The Senate passed legislation last summer to spend $52 billion on manufacturing and researching computer chips in the United States. Funding has yet to be enacted and lawmakers are still negotiating the details.

Ex-Trump adviser calls for Trump’s China tariffs to be lifted
Earlier this month, Senators Elizabeth Warren and Bernie Sanders and Rep. Sean Casten called for “corporate guardrails” that would ensure funding does not go to enrich CEOs. Lawmakers have called for terms that would prohibit funding recipients from buying back their own shares, outsourcing jobs and abrogate existing labor contracts.

“Safeguards are needed to create and defend American jobs,” the lawmakers wrote in a letter.

Cohn, however, argued that these restrictions would deter companies from investing in America.

“If we put these safeguards in place, unfortunately what’s going to happen is American companies won’t take the money,” Cohn said. “They will take money from foreign governments and they will build their facilities in foreign countries.”


Cnn

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