President's Budget Proposal Pushes Tariff Drop-Off to Future
Deep in the White House budget proposal, the administration projects that after collecting $93 billion in duties in the current fiscal year, only $54 billion will be collected between Oct. 1 and Sept. 30, 2023. It projects collections would drop further to $46 billion in fiscal year 2024 before gradually climbing to $60 billion in 2032. Last year's budget projected that there would only be $57 billion in duties collected in this fiscal year, and $45 billion next fiscal year.
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Even as the narrative emphasized how the U.S. is resolving "significant trade disputes, including on airplanes, steel, and aluminum," those tariffs are small compared with the tariffs on Chinese imports. The Airbus-related tariffs only totaled about $1 billion before being lifted; global aluminum tariffs are less than $1 billion a year, and steel tariffs were about $2.5 billion in the 11 months through late March 2022.
The narrative for the budget released March 28 said, "We are joining with allies and partners to write the rules of 21st Century economics, trade, and technology."
It also said, "We are at the beginning of a decisive decade that will determine the future of strategic competition with China, the trajectory of the climate crisis, and whether the rules governing technology, trade, and international economics enshrine or violate our democratic values."
Supply chain disruptions were part of the narrative, as well, saying they are partly responsible for inflation. "America was not immune to the worldwide inflation that has followed the pandemic -- leaving too many families struggling to keep up with their bills," the release said.
But it also emphasized that the number of containers sitting on the docks at the ports of Los Angeles and Long Beach has fallen by more than 70% since early November. It said the U.S. is working to cooperate with allies in the Indo-Pacific on the supply chain.
The Federal Maritime Commission, the agency at the center of port congestion issues, would get $35 million, up from $30 million last year, and its staff would grow from 121 to 150.
The administration wants to send an additional $11 million to the International Trade Administration "to build analytical capacity in meeting new requirements on supply chain resilience across the manufacturing and services industries, as well as $5 million for the Bureau of Economic Analysis (BEA) to develop new data tools to measure American competitiveness in global supply chains."
Overall, the ITA's industry and analysis section would get $87 million, and its enforcement and compliance section would get $125 million, almost a 25% increase, under this proposal.
It said that at least $16.4 million would be dedicated to antidumping and countervailing duty enforcement on Chinese cases. The International Trade Commission is currently getting $110 million annually; the request is for $107 million. The ITC asked for $122 million.
What ends up being appropriated never matches what the administration requests. Senate Budget Committee Chairman Bernie Sanders said, "Now that the President has done his job, it is up to Congress to review it, pass the proposals that make sense and improve upon it. As the Chairman of the Senate Budget Committee, I will be doing everything I can to pass a strong and robust budget reconciliation bill that works for working families, not the top 1 percent."