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This is how the trade war between China and the US affects your pocket. 2:09
(CNN) - The president of the United States, Donald Trump, will sign on Wednesday the "first phase" of the trade agreement with China, but the agreement - which has been in process for almost two years - will not suspend the tariffs that the president has tax on goods manufactured in the Asian country.
The agreement is expected to keep taxes on some 370 billion dollars in goods, or almost two-thirds of what the United States imports from China. Tariffs have raised the price of items such as baseball caps, luggage, bicycles, televisions, sports shoes and a variety of materials used by US manufacturers.
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Trump used tariffs as a negotiating strategy, aimed at hurting China's economy and pressuring Beijing to accept a new trade agreement that addresses unfair commercial practices, such as intellectual property theft and forced technology transfers. That is a goal with which business leaders across the country and legislators of the two parties agree.
But the taxes have also hurt the Americans. The results of companies in the country have been reduced, forcing owners to make decisions about job cuts and price increases to consumers. In addition, uncertainty about how long tariffs will be in effect and whether Trump will increase the rate - something he did last May just a few days in advance - discourages companies from making long-term investments, potentially costing some of the growth of U.S.
These are the key figures left by the commercial war.
300,000 jobs lost
A Moody's Analytics report indicates that the trade war with China, which began in early 2018, cost 300,000 lost jobs until last September, according to an economic simulation.
But, even with that loss, the growth of jobs in the United States remains strong. The country added 2.1 million jobs in 2019, although at a slower pace than the previous year when 2.7 million vacancies were created.
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Although it is difficult to know exactly how many lost jobs can be attributed to trade tensions, Moody's report is not the only one to suggest that tariffs are having an effect on American workers.
A company survey, conducted by Challenger personnel firm Gray & Christmas, found that commercial difficulties were cited as the main reason for cutting more than 10,000 jobs in August alone. And a Tax Foundation analysis also suggests that the trade war will result in the loss of long-term jobs.
US importers paid an additional $ 46 billion in tariffs
Trump is wrong when he says China is paying the tariffs.
The cost of the tax comes directly from the bank account of a US importer when the goods arrive at the port.
- READ: The risks of Trump's commitment to the trade war with China
US companies have paid $ 46 billion more in tariffs than they would have disbursed without Trump's taxes, according to a government data analysis conducted by the free trade coalition Tariffs Hurt the Heartland. US importers may choose to assume the cost of the tariff or transfer part of it - even the totality - to the consumer.
Now, it is also possible that some Chinese manufacturers have lowered their prices to remain competitive in the US market. However, at least two documents published last year suggest that US companies and consumers. They take the worst part for the cost of tariffs.
Taxes cost US consumers.
Multiple studies show that tariffs end up costing American families. JPMorgan Chase noted that the taxes applied in 2018 generated an average cost of $ 600 per year for households.
A different report, made by the New York Fed and the universities of Princeton and Columbia, estimated that these tariffs would cost households even more money: $ 831 a year. His research also considered the price of changing supply chains to avoid paying taxes.
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But those estimates do not take into account the tariffs applied in September, which affected consumer goods such as toys, televisions and clothing. Previous tax rounds were for industrial products and were less likely to directly increase the cost to buyers.
Despite these increases, consumers are not seeing large increases in the prices of goods of all spectra. Inflation has fluctuated around 2% since the commercial war began and, although buyers' sentiment has fluctuated from month to month, it hasn't changed much since early 2018.
The production takes a beating
Trump has frequently argued that his tariffs are driving the US manufacturing sector, but the industry is going through a downturn. In December, a measure of productive activity decreased to its lowest point in more than a decade. Data from the Bureau of Labor Statistics (BLS) show that only 46,000 net manufacturing jobs were added in 2019, an increase of less than 0.5%.
While there are likely to be many factors at stake, a recent Federal Reserve economists document showed that tariffs are certainly dragging the sector.
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It is true that some companies benefit when Trump's taxes lead to the assets of a foreign competitor being more expensive. However, many manufacturers need to import materials to assemble their products nationwide. Tariffs have affected key items such as steel, engines and bicycle parts.
Any benefit of tariffs has been offset by the increase in the price of input materials and the effect of taxes that China applied in retaliation for products manufactured in the United States, the Federal Reserve document notes. He also said that these factors led to a reduction in manufacturing jobs.
Farmers are suffering. But Trump's assistance package helped
China targeted US farmers by applying retaliatory tariffs on agricultural products, such as soybeans, wheat and corn.
However, despite the fact that farmers lost one of their largest export markets, a recent survey found that farmers' sentiment is the highest since 2016 and the US Department of Agriculture. projected that agricultural income will increase 10% this year, its highest level since 2014.
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That is due in large part to Trump's financial assistance. His government has handed out about $ 28 billion - roughly double the auto bailout in 2009 - to farmers affected by Chinese tariffs. The payments are not intended to compensate for total losses, but they do help close the gap.
Without government assistance, which is expected to increase by 64% in 2019, agricultural income would actually have been reduced.
Now, Trump's help payments are not saving everyone. Agricultural bankruptcies increased 24% compared to the previous year, according to the American Farm Bureau.
China's growth slows, while the US economy strong stay
China's economic growth slowed to its lowest level in almost three decades last year, at least in part due to the effect of the trade war. Some US importers have changed their supply chains, buying from manufacturers in other Asian countries to avoid paying the tariff.
On the other hand, although the US labor market continues to be resilient and the economy continues to grow, it slowed down in the course of 2019.
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It's hard to know how much of that was due to the trade war, which slowed China's economy and had other global effects. But Trump's tariff threats continue to foster an uncertain business environment. In addition to China, it has applied taxes to foreign steel and European wines and cheeses. His government is currently evaluating the increase in European tariffs and the imposition of new taxes on a variety of French-made products and goods, a measure that has provoked strong protests from wine and restaurant importers.
tariffs China China US-China trade war