U.S. reviews China tariffs, possible pause on federal gas tax to curb
inflation
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[June 20, 2022] By
Kanishka Singh
WASHINGTON (Reuters) -President Joe Biden's
administration is reviewing the removal of some tariffs on China and a
possible pause on federal gas tax as the United States struggles to
tackle soaring gasoline prices and inflation, two top officials said on
Sunday.
U.S. Treasury Secretary Janet Yellen said some tariffs on China
inherited from the administration of former President Donald Trump
served "no strategic purpose" and added that Biden was considering
removing them as a way to bring down inflation.
Energy Secretary Jennifer Granholm said the president was also
evaluating a pause on federal gas tax to bring down prices, telling CNN
that such a move was "not off the table".
The comments come as the Biden administration struggles to tackle record
high gasoline prices and inflation, now at its highest in 40 years.
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Cleveland Federal Reserve Bank President Loretta Mester said inflation
will take two years to fall to the central bank's 2% target, "moving
down" gradually.
Yellen, speaking to ABC News, said the administration was reviewing its
China tariff policy but did not cite specifics and declined to say when
there may be a decision.
"We all recognize that China engages in a range of unfair trade
practices that is important to address but the tariffs we inherited,
some serve no strategic purpose and raise cost to consumers," she said.
Biden has said he is considering removing some of the tariffs imposed on
hundreds of billions of dollars worth of Chinese goods by his
predecessor in 2018 and 2019 amid a bitter trade war between the world's
two largest economies.
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Workers inspect a natural gas facility by Sinopec at its Dongsheng
gas field in Erdos, Inner Mongolia Autonomous Region, China October
15, 2018. REUTERS/Stringer
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U.S. OFFICIALS SAY RECESSION 'NOT INEVITABLE'
Both Granholm and Yellen reiterated Biden's stance that a recession was "not
inevitable", with the treasury secretary saying that labor market and consumer
spending remained strong. Mester also said she was not predicting a recession
despite slowing growth.
Yellen, however, described inflation as being "unacceptably high" and added that
she expected the economy to slow.
Whether the United States, the world's largest economy, will slip into a
recession has been a growing concern for chief executives, the Federal Reserve,
and the Biden administration.
Former U.S. Treasury Secretary Lawrence Summers told NBC News he disagreed with
the assessment of current officials, saying he expected a recession.
"The likelihood is that in order to do what's necessary to stop inflation, the
Fed is going to raise interest rates enough that the economy will slip into
recession," Summers said on Sunday.
The surge in inflation has made hawks of nearly all Federal Reserve
policymakers, only one of whom dissented earlier this week against what was the
central bank's biggest rate increase in more than a quarter of a century
(Reporting by Kanishka Singh in Washington; Editing by Chizu Nomiyama)
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