The editor's note: "California has become the first state in the United States to sue the federal government over tariff issues." According to the Los Angeles Times, Governor Newsom of California has drawn widespread attention by announcing this decision on April 16. Less than two weeks ago, he had stated that the tariff policy of the US federal government does not represent all Americans. Among the states of the United States, California dares to be the first to publicly oppose the tariff increase policy, which is closely related to its economic strength and its status as the largest import state in the United States. For the reasons why California can become the "Golden State" of the United States, the information released by the office of the governor of this state explains: "California has long been committed to global cooperation, innovation, and openness, and these factors have helped California become the fifth largest economy in the world." For those who believe that "reciprocal tariffs" can "make America great again," this information is worth taking seriously.
"They cannot afford the consequences of continuing chaos."
"Illegal tariffs are causing chaos for families, businesses, and our economy in California - driving up prices and threatening jobs. We are stepping forward to stand up for American families, who cannot afford the consequences of continued chaos." On April 16, Governor Newsom of California said in a statement when announcing the lawsuit against the US federal government over tariff policies. According to the Los Angeles Times, the US federal government previously announced a benchmark tariff of 10% on all goods imported into the United States under the International Emergency Economic Powers Act, with higher tariffs on goods from Mexico, Canada, and China. However, the California government believes that while the International Emergency Economic Powers Act allows the president to declare a national emergency and take certain actions when facing national security threats or economic threats caused by external factors, it does not grant the president the unilateral power to impose tariffs on goods imported into the United States.
Attorney General Bonta of California said that the US Constitution grants Congress fiscal powers. Professor Pasch of the Brooklyn Law School, co-director of the Brock International Business Law Research Center and associate professor of law, explained that according to the International Emergency Economic Powers Act, if the president wants to declare a national emergency, they must determine that there is an "extraordinary threat" to US national security or economy. President Trump's so-called trade deficit and manufacturing outflow are the results of the US's deliberate trade policy over the past 80 years, rather than such threats.
It is worth noting that it was Governor Newsom of California who announced the lawsuit against the US federal government. The Los Angeles Times reported that after the fires in California in January this year, he had been avoiding damaging the working relationship between California and the US federal government to avoid affecting federal support for California's reconstruction. Attorney General Bonta had previously represented California in handling various legal issues with the federal government. On April 16, Newsom said that after experiencing the effects of the tariff increase policy in recent weeks, he chose to take action.
This is not the first time that the California government has publicly expressed opposition to the federal government's tariff policies. On April 4, two days after President Trump signed the executive order regarding so-called "reciprocal tariffs," Newsom posted a video on X stating that the federal government's tariff policy does not represent all Americans. He was seeking agreements with other countries to ensure that California would not be affected by retaliatory measures due to the escalation of the US trade war.
"This is why we must defend the interests of 40 million Americans."
Why did California dare to speak out against the US federal government's tariff policies? Newsom's statement on April 16 mentioned part of the reason. He said that California is the strongest manufacturing state in the US, and the imposition of additional tariffs could result in billions of dollars in revenue losses for the state. "No state will suffer more losses than California... This is why we must defend the interests of 40 million Americans."
Located on the Pacific coast and bordering Mexico, California is the most populous and economically significant state in the US, also known as the "Golden State." Information released by the office of the governor of California shows that California is the world's "fifth-largest economy," with a GDP of approximately $3.9 trillion, 50% higher than Texas, the second-largest state in the US, and a key driver of US economic growth. At the same time, California is also the state with the most import trade in the US, with bilateral trade exceeding $675 billion with other countries, providing millions of jobs across the entire state. California is the state with the most Fortune 500 companies in the US. Many of the top 50 leading artificial intelligence companies globally are based in California. The state is also the manufacturing hub of the US, with over 36,000 manufacturing enterprises employing more than 1.1 million people. California ranks first nationwide in multiple fields such as venture capital financing and agriculture. The state pays over $83 billion annually to the federal government each year.
"California has long been committed to global cooperation, innovation, and openness." The information released by the office of the governor of California provides an annotation for the economic achievements of California. It shows that during Governor Newsom's tenure (January 2019 to present), California has signed 38 international agreements with 28 different foreign partners, laying a critical foundation for long-term economic success. Governor Newsom's former senior economic advisor, Mendoca, told Politico that California is open now, in the past, and in the future, which is an important component of California's brand and economic strength.
Trade with Mexico, Canada, and China is crucial for California. According to information released by the office of the governor of California, over 40% of the state's imports come from these countries. In 2024, out of the total $491 billion worth of goods imported into California, the total imports from these countries amounted to $203 billion. Mexico, Canada, and China are the top three export destinations for California, purchasing nearly $67 billion worth of California exports, accounting for more than one-third of the state's $183 billion in exports for 2024.
Both officials and the public in California have long valued their traditional ties with China. Governor Newsom visited China in 2023 to promote trade relations between both sides. A survey conducted last year by the Carnegie Endowment for International Peace found that a large proportion of Californians consider US-China relations to be "very important" (44%) or "somewhat important" (40%).
Multiple industries "tremble" due to constantly changing tariff policies.
"From almond growers dependent on foreign buyers to Silicon Valley giants reliant on Chinese components, the main industries driving California's economy continue to 'tremble' due to the US federal government's constantly changing trade policies," reported multiple media outlets including Politico and The Guardian. The imposition of additional tariffs may have adverse impacts on several industries in California.
California is an agricultural powerhouse, supplying approximately one-third of the vegetables and three-quarters of the fruits and nuts consumed in the US. It is also one of the largest agricultural exporting states in the US, with an agricultural output of approximately $59 billion. In 2022, its agricultural exports reached nearly $24 billion. In recent years, Canada has been the largest foreign buyer of California's agricultural products, followed by the EU and China. Now, in addition to the Canadian government imposing a 25% tariff on many US goods, Canadians have also started boycotting American products. The EU recently included California's top export agricultural product—almonds—on the list of US goods subject to retaliatory tariffs. California produces about 76% of the world's almonds, with three-quarters of its production exported, primarily to countries like India and Spain.
Many California farmers still vividly remember the trade war launched during Trump's first term. Carter, a professor of agricultural economics at the University of California, Davis, described the consequences of this trade war as a "disaster," with many local farms being put up for sale. He explained that this trade war caused $27 billion in losses to American agriculture. According to an analysis by researchers at the University of California in 2022, nut growers in California were hit hardest, suffering losses of $880 million. Carter believes that this time the situation may be worse, with new trade wars potentially causing California $6 billion in annual losses and destroying one-quarter of the state's agricultural exports.
Many farmers and agricultural department officials in California are anxious and concerned about the possible consequences of the US tariff policy. Citrus grower Caprilean said they have already felt the impact of the tariff policy on their product sales, "Everyone will feel it." Farmer Dina's products have not yet been affected by the tariff policy, but he said he is closely monitoring developments, "Everyone is holding their breath." "Uncertainty may have a greater impact than the tariffs themselves." Williams, director of sales at a local orchard, said that due to the cyclical nature of agriculture, uncertainty makes it difficult for farmers to make planting plans.
"In ongoing trade friction, tourism is one of the victims." On April 12, the Los Angeles Times reported that data from the California Tourism Board showed that California is the top destination for foreign tourists coming to the US. Last year, international tourists spent $26.5 billion in California, an increase of 17.5% compared to 2023. However, in March, the California Tourism Board revised its forecast for tourist spending in 2025 from an initial $166 billion to $160 billion. Additionally, a travel data company based in Philadelphia predicted a 5% reduction in international tourists visiting the US this year. The Los Angeles Tourism and Convention Board stated that 510,000 people in Los Angeles work in tourism and hospitality, with over 1,000 related enterprises. Chairman of the local hotel association, Fila, said that although hotel operators in Los Angeles are working hard to attract foreign tourists, federal government policies make tourists from other countries dissatisfied. "So why should they come to the US? Globally, we are not only ruining our own economy but also that of other countries."
A potential reduction of $90 billion to $143 billion in consumer spending on technology products
Several California-based technology companies, including Apple, Oracle, and Dell, will also be affected by the tariffs. A report co-authored by the California Chamber of Commerce Foundation and its Business and Education Foundation shows that the technology sector accounts for 19% of the regional economic output in California, contributing $623.4 billion to the state's economy by 2022.
Apple is considered the company most severely impacted. For a long time, the company has assembled almost all of its iconic products in China. Analysts point out that more than 80% of Apple's phones are manufactured in China. The Consumer Technology Association representing major US tech giants such as Apple and Meta predicts that the imposition of tariffs may reduce US consumers' ability to purchase technology products by $90 billion to $143 billion, with many of these products sold by California-based companies.
After the US federal government announced increased tariffs on China, Amazon canceled some international orders. Meta and Google are also concerned about their advertising revenue, particularly from the Chinese market. Analysts warn that such severe uncertainty may affect development in certain technology sectors, which are areas where California and the US urgently hope to maintain leadership, including artificial intelligence, semiconductors, and clean energy.
Andre, who works at Amazon, told a special correspondent of the Global Times in the US that California's technology companies are already feeling a certain level of pressure. "Most large companies in the US technology sector rely more or less on Chinese manufacturing. Now we face the threat of being squeezed from both ends—rising costs and potential production delays. Not just high-priced items like smartphones and tablets, but even low-cost items like chargers will be affected by the tariff war." Andre said he learned that some California companies are already preparing contingency plans to discuss how to address potential problems arising from product price increases.
California's manufacturing sector also struggles to avoid the negative impacts of increased tariffs. According to reports by Politico, Gloria, a Democrat and mayor of San Diego, the largest border city in California, is preparing for the potential destruction of local cross-border trade caused by tariffs. Mayor Gloria explained that in the process of producing automotive parts and televisions, these products need to go back and forth between the US and Mexico several times.
Litigation and lobbying activities may influence tariff policies.
The US federal government's tariff policies will also impact post-fire reconstruction efforts in California. According to Politico, Bonta said that before suing the US federal government over tariffs, he had direct conversations with many people from businesses and trade organizations who were angry about tariffs, including the California Chamber of Commerce and the Pacific Maritime Association. Regarding this lawsuit, a White House spokesperson issued a statement criticizing it, claiming that California is not focusing on addressing regional issues but is attempting to obstruct the federal government's "historic efforts" to resolve trade deficits.
To reduce the impact of retaliatory tariffs from other countries on California's economy, the state recently announced plans to take multiple measures, including supporting industries dependent on cross-border trade to create jobs and innovate, and taking actions to ensure economic stability for businesses and workers affected by tariff policies.
In addition to California, several small US businesses recently filed a lawsuit in the US Court of International Trade against the federal government, arguing that without congressional approval, the federal government has no authority to announce comprehensive tariff increases. Song Guoyou, deputy director and professor of the American Research Center at Fudan University, told the Global Times that strong opposition voices from California and other regions indicate serious impacts on their interests. Through legal litigation and lobbying activities, they can influence US federal government tariff policies to a certain extent. Some views suggest that tariff policies may put Republicans at a disadvantage in the 2026 midterm elections.
He Weiwen, standing director of the China Council for the Promotion of International Trade and a senior researcher at the Center for China and Globalization, said that as the US continues to implement its tariff policies, domestic dissatisfaction may gradually accumulate. Beyond China, the US is still in a 90-day suspension period for tariff negotiations with other countries. During this phase, the impact of the 10% benchmark tariff is not particularly noticeable. However, if the so-called "reciprocal tariffs" are officially implemented after 90 days, combined with subsequent effects of the Sino-US博弈, policy consequences are expected to gradually become clear within the next few months. Against this backdrop, opposition voices from US states and businesses are likely to grow stronger. If the US economy experiences a downturn, particularly significant turbulence in the bond market, the US government may be forced to adjust its tariff strategy. However, such policy shifts are passive responses and not out of the White House's proactive intent.
Source: Global Network
Original article: https://www.toutiao.com/article/7494453374956339723/
Disclaimer: This article solely represents the author's personal views. Please express your opinions by clicking the 'Agree/Disagree' buttons below.