But Trump is running out of goods to tax, and the expanded tariffs he threatened over the weekend could result in a 25% tax on almost everything else the US imports from China.
“These goods were deliberately set aside before because they would be painful for us,” said Phil Levy, a senior fellow at the Chicago Council on Global Affairs who served as a senior economist for trade under President George W. Bush.
The renewed threat has toy companies big and small worried that they will have to raise prices, dragging down sales this holiday season.
About three-quarters of the toys sold in the United States are made in China, including the top-selling L.O.L. Surprise dolls, said Toy Association President Stephen Pasierb.
“We’re in a low-margin, price sensitive business. If the price goes up by 25% on a $10 toy, people aren’t going to buy them,” he said.
A long list of consumer electronics could also end up being hit by new tariffs, including smartphones, computers, televisions, fitness trackers, Bluetooth wireless headsets and even drones, according to Sage Chandler, vice president of international trade at the Consumer Technology Association, a major industry trade group.
Moody’s Analytics predicts that the tariff rate hike and new tariffs would slow GDP growth in China by 1.2 percentage points. It also predicts a slowdown in US GDP and an increase in the unemployment rate if both are imposed.
Industry groups have been trying to persuade the Trump administration to drop further tariffs for months.
The Consumer Technology Association and its members raised concerns over trade policy with the White House and Congress as recently as last week, when a number of the group’s member CEOs visited Washington.
Still, many policy analysts continue to believe the Trump administration’s tariff threats are more of a bargaining tactic than a sign of a breakdown.
“I don’t think we’re at the point where people think the talks are completely dead,” said Rob Atkinson, president of the Information Technology and Innovation Foundation. “People aren’t there yet. They’re more of the view that this is a method by which you’d force the Chinese to give more than they’ve given.”