Why does the United States government allow China to place a huge import tax on American goods and yet let them flood the American market with cheap low quality goods?

Would mirroring their import taxes help level the playing field for American goods and bring back jobs? Why or why not?

Two important issues need to be addressed: First an import tax is actually a tariff targeting specific merchandise and second the U.S. trade deficit with China is mainly due to semi-manufactures that U.S. companies used as inputs for finished products.

Another big ticket items is that almost 90 percent of the decline in U.S. manufacturing jobs between 2000 and 2010 was caused by productivity gains (robots and computers), rather than import competition. So, unless we want to destroy all the robots, those jobs just aren’t coming back, tariff or not. Furthermore, the idea that the U.S.-China trade balance proves that we’re “losing” at trade is short sighted. An examination of the past 30 years of U.S. economic performance offers no evidence that a larger level of imports or growing trade deficits have negatively affected the U.S. economy.

Academic economists that have studied these issues teach that that trade balances reflect national savings, consumption and investment, not trade policy. In other words, we buy goods and services from foreigners, and they buy an equal amount of our exports plus our financial dollar-assets.

The U.S. Constitution gives Congress the sole authority to impose tariffs on foreign-made goods and would need legislation for a tariff regime on China however the current record of Congress passing new legislation is dismal at best.

A new tariff would be blatantly inconsistent with two of the United States’ most fundamental obligations under WTO agreements: (GATT Article I the principle that a WTO member must treat imports from all other members equally) and (ii) the United States’ tariff bindings (GATT Article II—the rule that a WTO Member cannot impose tariffs above the “bound rate” set forth in its tariff schedule).This WTO-sanctioned retaliation would effectively close the United States’ third-largest export destination. Furthermore, China could go straight to the WTO and easily win the right to impose retaliatory tariffs on U.S. exports in the amount of the damage caused by the tariff.

Finally, considering that U.S. exports to China totaled only about $115 billion in 2015, this WTO-sanctioned retribution would effectively close the United States’ third-largest export destination a shattering effect for American exporters.