Will American duties stay with us for 20 years? Democrats will not kill a hen tolerate golden eggs

American duties imposed on the EU may apply up to 20 years and although economically harmful are politically attractive, they do not require raising taxes and therefore can also be maintained by democratic administrations – according to the Think Tank Bruegel analysis.

According to most experts, tariffs can stay from 7 to 20 years and this is a pessimistic scenario. Supporters of this concept argue that although the duties are economically harmful, they remain politically attractive. Even the Democrats administration, as pessimists indicate, is not inclined to abolish them, and an example is the lack of dismissal by President Joe Biden of earlier, lower duties introduced by Donald Trump's first term.

In their opinion, the abolition of tariffs could only bring the global reform of the trade system as part of the World Trade Organization, which in the current situation seems not very real.

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In addition, duties generate budget revenues without the need to formally raise taxes, which in a strongly polarized US political environment makes them an attractive instrument for the authorities. Their negative economic effects – higher inflation or slowing down economic growth – can be difficult to capture for public opinion and do not prioritize voters, which strengthens their political durability.

In turn, optimists predict that the tariffs may apply shorter – from two to five years. They point out that customs are economically ineffective and increase the risk of staglation in the US, including by slowing down GDP growth by 0.5 percent in the years 2025–2026 and maintaining inflation above the purpose of the federal reserve. In addition, the historical context of the introduction of high duties by Trump indicates their nature of a politically motivated event.

Proponents of shorter maintenance of tariffs also emphasize that revenues from customs, estimated by the US administration at around $ 300 billion this year, constitute only 0.7 percent. GDP, which means that their potential loss can be compensated by other funds. In addition, the negative effects of duties are felt for consumers and companies, which in democracy limits the possibility of their long -term maintenance. The abolition of tariffs could also be a way for Democrats in a clear distinction from the policy of the previous administration.

Experts also emphasize that after months of uncertainty related to the decisions of Trump's administration regarding duties on imports from abroad, the situation in international trade was relatively stabilized. In most cases, imports from the European Union were covered by a customs tariff of up to 15 %, and the main debate moved from the question about the possibility of avoiding or limiting duties to the question of how long they will apply.

From Brussels Łukasz Osiński (PAP)

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