Us Treasury Secretary: Indiscriminate tariff increases hurt American families and weaken business competitiveness

U.S. Treasury Secretary Janet Yellen has warned that indiscriminate, wide-ranging tariffs will hurt American families and businesses and prevent the United States from advancing its economic and security interests.

"Calls to build walls around the United States by imposing high tariffs on friends and competitors alike, or to treat even our closest Allies as trading partners, are highly misleading," Yellen said in remarks prepared for the Council on Foreign Relations. The Treasury Department released excerpts of the speech.

With less than three weeks to go before the US presidential election, Republican candidate Donald Trump has touted tariffs as his preferred economic policy tool. He promised to impose tariffs on both America's traditional Allies and adversaries.

In an interview with Bloomberg this week, Trump called tariffs "the most beautiful word in the dictionary" and fully defended his protectionist policies. Trump also complained that countries as diverse as China, Mexico and France were taking advantage of the United States.

If Republicans take the White House, they will propose a 10% across-the-board tariff on imports. Trump said such a universal tax would bring in billions of dollars in revenue and help fund further tax cuts, among other measures. Trump's trade agenda also includes tariffs of 60 percent or more on Chinese-made goods, a move that mainstream economists say would essentially amount to a tax increase on American families.

Yellen issued a similar warning, arguing that "across-the-board, untargeted tariffs would raise prices for American families and make our businesses less competitive."

She added: "We simply cannot hope to advance economic and security interests - such as opposing Russia's illegal invasion of Ukraine - if we go it alone."

In her speech, Yellen defended the Biden administration's stance toward China, which is to defend and ensure national security while not trying to economically contain China, a major geopolitical rival.

"Trade and investment with China can generate significant gains for American companies and workers and must be maintained," Yellen said. The two sides "must also have a healthy economic relationship based on fair competition," she added.

Ms. Yellen has repeatedly warned that China's overcapacity could flood global markets with artificially cheap goods, killing industries in the United States and around the world. In May, the United States raised tariffs on a range of Chinese-made products, and Ms. Yellen has been leading efforts to press American Allies to take action on the issue.

She defended the measures Thursday, saying "no matter how much we invest to strengthen domestic manufacturing, we cannot support American businesses and families without addressing these challenges."