Scott Lincicome and Chad Smitson
The “Section 122” tariffs, imposed after February’s Supreme Court ruling against President Trump’s “emergency” tariffs, expired last night and were immediately replaced by “Section 301” tariffs of roughly the same amount. The new duties range from 10 to 12.5 percent, cover goods from 60 economies, and are justified as a crackdown on “forced labor.”
In my new column at The Dispatch, I show why these tariffs have almost nothing to do with forced labor and instead are just “a ham-fisted way to reinstall Trump’s tariff wall and protect it from another IEEPA-like defeat in federal court.” Five issues stand out:
The administration said the tariffs were coming before the investigation ended. President Trump, Treasury Secretary Bessent, and US Trade Representative Greer all publicly and explicitly promised that the tariffs and their revenue would replace the struck-down IEEPA regime before the investigations even started.
The requisite report on “forced labor” is remarkably thin. USTR’s investigation only took 82 days and generated a 98-page report to cover 60 economies, devoting little more than half a page to each, much of it the exact same empty passages copied and pasted 60 times—far short of the rigor demanded of such a consequential and far-reaching trade action. The report also contained no evidence or analysis – none – of targeted economies’ forced labor policies causing actual harm to US companies or commerce. It’s all just assumed. Nor did the USTR explain why it applied the same punitive 12.5 percent tariff rate to Angola, Libya, Russia, Venezuela, and Kazakhstan—developing countries that rank low on the Walk Free forced labor index (and have other issues!)—as it did to developed, “good actor” countries like Norway, Japan, Switzerland, and Australia.
The United States is hardly a forced labor angel. Section 307 of the Tariff Act of 1930 has prohibited imports made with forced labor, but was lightly enforced for over 80 years due to wide exceptions, and the Trump administration’s enforcement of the law has been much more lenient than the Biden administration’s efforts. Furthermore, the US ranks 19th among the 60 economies for the prevalence of forced labor.
The tariff cure dramatically overshoots the forced labor disease. Some back-of-envelope math puts a proportionate tariff at 0.5 to 0.84 percent; Peterson Institute economist William Cline, using a different model, gets 0.23 to 0.25 percent. USTR is proposing 10 to 12.5 percent, a rate and resulting revenue (see figure below) that far exceed what could be considered a proportional response to the problem.
There’s no off-ramp. Section 301’s statutory goal is the removal of the offending foreign policy, yet USTR offers no benchmarks for compliance that would remove the tariffs. Indeed, a country with the United States’ exact forced-labor framework could still get slapped with duties.
As I explain, the Section 301 tariffs on Chinese imports that Trump imposed during his first term provide a telling contrast:
Trump’s case against Chinese intellectual-property and industrial policy wasn’t without fault, but it still required an eight-month investigation and produced a nearly 200-page report on a single country. And the recommended tariffs—initially set at $50 billion to match/offset the alleged harm from the targeted Chinese policies—came only after U.S.-China negotiations collapsed.
Forced labor is a real and complicated problem, but disingenuously dressing tariff revenue recovery in human rights language discredits the tools that might actually address it, setting a precedent for Section 301 to be an all-purpose tariff generator that any future president can invoke for any reason. Congress should fix the law before President Trump—or his successor—does even more damage.
Note: On July 24, the Liberty Justice Center filed a lawsuit in the US Court of International Trade challenging the administration’s replacement tariffs imposed under Section 301 of the Trade Act of 1974.
