Since coming into office, President Donald Trump has made rebalancing our trade agreements a top priority, placing historic tariffs on traditional trading ‘partners’ who have taken advantage of American businesses for decades and adversaries hell-bent on our economic collapse such as China. His “Liberation Day” tariffs were indicative of his bold commitment to that mission.
While the full slate of economic measures is necessary to reignite the economy, it is his China plan that could finally put an end to the Chinese Communist Party’s all-out assault on U.S. manufacturing and our small business community.
In 1930, Congress passed the Tariff Act, which introduced what has become known as the “de minimis” rule. It allowed imports valued under $800 to enter the country duty-free and American recipients to get up to $800 worth of products per day without paying import taxes. Despite almost 100 years passing, this law remains on the books to China’s benefit. Or at least it was, until Wednesday, when Trump said, “No more.”
For decades, China has flooded the American apparel market with cheap, poorly made T-shirts, sweaters, and other clothing via shell companies, partners, and, as of recently with companies such as Shein and Temu, plainly out in the open. Similarly, Chinese knock-offs of high-quality American brands pop up on Amazon to undercut the originals. And while the consumer enjoys getting something that would normally cost $20-30 for $5, this is a key component of Chinese President Xi Jinping’s plan to further hook the American consumer on Chinese goods.
Even worse, these products are often made from cotton produced in Xinjiang, the Chinese region well known for the documented use of slave labor, internment camps, and the full-scale repression of the country’s Uyghur minority. Despite U.S. law banning the import of Xinjiang products, they still make it into the country via lax enforcement by Customs and Border Protection and virtually no tariffs on their import because of the de minimis rule. Instead of bringing in shipping containers full of these goods, they ship them directly to American consumers, a few dollars at a time, avoiding any oversight.
Shein and Temu do this out in the open, largely encouraged by Biden administration officials who saw clamping down on China as an impediment to rapprochement with Beijing, as some brands hide their nefarious acts. Some, such as the innocuously named Next Level Apparel, claim that the products they bring into the country are all in legal compliance, often stating that products come from places such as Nicaragua. Not only has isotopic testing shown that products within their supply contain cotton consistent with that coming from Xinjiang, but reporting illuminated that their cotton has been quarantined because it likely contained materials from prohibited sources.
And while Next Level is one of the more egregious examples of this as it sells its blanks to scores of American brands, this is common practice for companies that abuse the de minimis rule and poor border enforcement. As a result, made-in-America brands that produce their cotton here, cut and sew it into apparel in American manufacturing facilities, and sell it to Main Street businesses suffer. They cannot compete with products that have virtually no labor costs and are produced at pennies on the dollar when they are paying American workers a wage they can live on alongside vital health benefits.
The Main Street effects are clear, however, the long-term damage to the local and federal deficits is even worse. Import duties and tariffs are pivotal to rebalancing trade agreements and ensuring that the federal government is rightfully paid for the access it gives to foreign importers. We rely on those levies to ensure American businesses are not undercut by international competition. But when companies skirt those fees, they kneecap small businesses that can’t compete, forcing them to close their doors, lay off employees, and close up shop — further hurting local communities that rely on that tax revenue to provide essential services such as police and firefighters.
Trump has demonstrated that he is not afraid to use his executive authority to right the wrongs in our federal government in favor of the public. Buried among the mainstream media’s hair-on-fire coverage of the reciprocal tariffs was the president taking bold action to close the de minimis loophole that allowed China to circumvent his necessary tariffs. Now, our economy can be weened off China’s paltry knockoffs.
HOW COUNTRIES ARE REACTING TO TRUMP’S ‘LIBERATION DAY’ TARIFF ANNOUNCEMENTS
He should take this one step further and direct his Department of Homeland Security to clamp down on import law enforcement, revoking import licenses from those who violate these statutes and implementing progressively more harmful penalties — including prison time for the most egregious offenders.
As the Trump administration has wisely demonstrated with immigration enforcement, those who violate our laws have no place in benefiting from our country’s generosity and economic opportunity. Those are reserved for law-abiding Americans who love this country and want to see it succeed. With a stroke of a pen, Trump has sent a powerful message to China and its partners who would see American businesses suffer. Americans are stronger for it.
Bernard B. Kerik was the 40th commissioner of the New York City Police Department and is a New York Times bestselling author.
