President Trump announces 15 percent tariff on Japanese goods: CEI analysis

Last night, President Trump announced a trade deal with Japan that included a 15 percent tariff on Japanese goods, including cars, entering the US. CEI trade and economic experts explain why this will be an expensive deal for consumers.

CEI Vice President for Strategy & Senior Fellow Iain Murray:

“The US-Japan deal shows that the President has replaced ‘win-win’ with ‘lose-lose.’ The deal is better than what Japan was threatened with a few weeks ago, but it might still cause PM Ishiba to lose his job. American consumers will lose as they pay much more for Japanese goods than they did previously, and bizarrely the domestic auto industry will face stiffer competition as Japanese whole car imports will face a lower tariff than the combined impact of tariffs on imported vehicle components like copper and finished parts from Canada. The only winner is President Trump, who apparently gets to personally direct where $550 billion of Japanese investment will go, which is hardly the operation of the free market in action.”

CEI Senior Economist Ryan Young:

“This is a lose-lose trade deal for both America and Japan. Six months ago, Americans were paying roughly 2 percent tariffs on Japanese products. Now we will pay a 15 percent tax, or nearly a seven-fold increase.

“While this is a smaller tax hike than President Trump’s threatened 25 percent tariff, it is still a big loss for American consumers and retailers, as well as American manufacturers who use Japanese components. Fifty percent tariffs on steel and aluminum will remain in place.”