Here’s a letter to the Washington Post.
Editor:
The Trump administration’s latest rationale – of which you’re wisely skeptical – for imposing under Section 301 broad punitive taxes (a.k.a. tariffs) on Americans’ purchases of imports is that it wishes to combat forced labor (“Trump tries a new trick to raise tariffs,” June 4).
Every civilized person sympathizes with prohibitions on the sale and purchase of goods produced by slaves. Yet every such person also understands that protectionists have incentives to abuse this sympathy by exaggerating the extent to which the stream of commerce contains slave-produced goods. In this light, here are some relevant facts (gathered with the help of Claude).
In China, the trading partner touted as most reliant on forced labor, the upper estimate of the number of forced laborers is 3.17 million. Now looking at other data from 2024 – and making assumptions as generous as possible to the administration’s case – we have these additional facts:
– Total number of manufacturing workers in China: 120 million
– Annual U.S. imports of manufactured goods from China (including estimates of transshipments): $542B
Even if (contrary to fact) all forced-labor workers in China work in manufacturing, that means that 2.6 percent of China’s manufacturing workers are forced laborers. Assuming (also likely contrary to fact) that the productivity of these workers is as high as that of China’s non-forced-labor manufacturing workers – $39,000 per worker – the value of U.S. manufactured-goods imports from China that is produced by forced labor is likely around $14.1B. With total U.S. imports of manufactured goods being $2.71 trillion, the maximum share of U.S. manufactured-goods imports that is produced by Chinese forced labor is 0.5 percent.
As a portion of total annual U.S. production of manufacturing output – $7.1 trillion – U.S. imports of forced-labor manufactured goods from China are a paltry 0.2 percent.
These numbers strongly suggest that the effects on America’s economy of forced labor in China are too minuscule to meet Section 301’s requirement that the challenged actions be shown to burden or restrict U.S. commerce.
Sincerely,
Donald J. Boudreaux
Professor of Economics
and
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030
