On September 26, 2024, Senator Tom Cotton introduced a significant piece of legislation titled the 'Neither Permanent Nor Normal Trade Relations Act,' aimed at ending China's 'normal' trade relationship with the United States. This bill proposes to double import tariffs on Chinese goods over a span of five years. Cotton, along with co-sponsors Senators Marco Rubio and Josh Hawley, criticized the current trade relationship, arguing that it has been detrimental to American workers and the U.S. economy. Cotton emphasized that China's Permanent Normal Trade Relations (PNTR) status has had negative repercussions for the U.S. economy, a sentiment echoed by the Coalition for a Prosperous America, which supports the bill due to concerns over China's trade practices [1289a044].
The proposed legislation comes amid ongoing tensions in U.S.-China trade relations, which have been characterized by tariffs and retaliatory measures since 2018. Economists at the University of Rochester have previously analyzed the trade war's potential longevity, suggesting that there is less than a 20 percent chance it will end by 2025. Their findings indicate that the expected trajectory of tariffs under President Biden is projected to increase, reflecting a broader trend of escalating trade tensions [f0d6cb90].
However, the U.S.-China Business Council has raised alarms about the potential consequences of increased tariffs, warning that such measures could lead to significant job losses—up to 801,000 by 2025—due to retaliatory actions from China. This highlights the delicate balance policymakers must strike between protecting American interests and avoiding further economic fallout [1289a044].
The ongoing trade war has already seen tariffs imposed on billions of dollars' worth of goods, with both countries engaging in a tit-for-tat strategy. Former President Donald Trump initiated the trade war in 2018, and the Biden administration has largely maintained these tariffs, leading to a complex economic landscape for businesses and consumers alike. The implications of Cotton's bill, if passed, could exacerbate these tensions and lead to further economic instability [59ddcc1f].
As the 2024 presidential election approaches, the outcome could significantly influence U.S.-China trade policies. A Democratic victory might lead to a different approach, while a Republican win could see a continuation or escalation of the current trade war. The potential for increased tariffs and trade restrictions looms large, with both sides assessing each other's strengths and vulnerabilities as they navigate this contentious relationship [3ae16ce4].