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White House To Announce China Tariffs

STEVE INSKEEP, HOST:

He's made this threat a number of times. And today, President Trump is preparing to do it, impose tariffs on $50 billion worth of Chinese-made products. The U.S. turned aside China's offer in last-minute talks to buy $70 billion worth of American farm and energy products. Now China is preparing to retaliate for the new tariffs, or taxes on imports, that tend to raise their price in the United States. Carlos Gutierrez was the commerce secretary under President George W. Bush. He's been following this.

Welcome to the program.

CARLOS GUTIERREZ: Good morning.

INSKEEP: So when we think about what seems likely to be taxed here - televisions, medical devices, aircraft parts, batteries, a lot of other things - do you feel you understand what the strategy is?

GUTIERREZ: Well, the idea is to tax as many either high-tech or high-tech-related materials that are coming out of China given that this stems from a 301 initiative, the 301 being targeted at intellectual property and technology transfer.

INSKEEP: Well, with that - I guess that gets to what the administration is concerned about. China is trying to dominate certain high-tech industries and is accused of doing so in part by taking U.S. technology. Right?

GUTIERREZ: That's just one piece of this. That's what is called Article 301. That is directly targeted at technology, technology transfer, intellectual property rights and very much focused on what China calls China 2025, when they plan to be almost self-sufficient in technology. There are other tariffs coming on. There's an investigation on autos. There are aluminum and steel tariffs. There are other things up in the air.

And part of the problem is that there are too many things up in the air, too many threats, too many tariffs. And it's just hard to keep track of it all. And it is about tactics. Even though there is a trade strategy, these are circumstantial tactics. You never know what's going to happen next because a lot depends on the circumstances of what happens now. Everything seems to be in reaction to something else.

INSKEEP: OK. So I think you're saying that some in the administration have a strategy. They have real concerns they want to raise with China. But the administration thrives on chaos. There's a president who likes to be unpredictable. And you're saying too many things are happening at once, and it's hard really to execute the strategy.

GUTIERREZ: Yeah. I mean, I think there's a strategy in the sense that there is a concept that says that the U.S. has been taken advantage of, and we can see that through the trade deficit. I personally disagree with both. But after that, there really isn't a strategic plan. It's sort of being worked on as we go along. And that's part of the problem. So you don't know. Right now the president is being criticized by Congress for having backed off a little bit on ZTE - on the sanctions against ZTE for having broken...

INSKEEP: Right.

GUTIERREZ: ...Iran's sanctions. That, in turn, may make the president feel like he has to be more forceful with these tariffs to show that he is strong. So again, that's what I mean about tactics. It's usually a response to something that just happened. And that's why it's so difficult to track. And anyone who wants to track it should do it every day.

INSKEEP: So it's unpredictable what the administration is doing. Is it predictable, though, what happens now? The administration goes through with these tariffs, and then it's China's turn.

GUTIERREZ: Yes, that's easier to predict. China will respond. And China will respond with products that will hurt the U.S. and will hurt U.S. lawmakers. So they've targeted Kentucky bourbon; they've targeted Harley-Davidson - Kentucky bourbon, of course, being from the state where Mitch McConnell's from. They've targeted products from Wisconsin, which is where Paul Ryan is from. So they know what they're doing. And they're also targeting red-state products.

INSKEEP: Carlos Gutierrez is a former U.S. commerce secretary. Thanks very much.

GUTIERREZ: Thank you very much. Transcript provided by NPR, Copyright NPR.