Samsung and LG Washing Machine Safeguard Cited During First Term
The Wall Street Journal: "Only Washing Machine Prices Rose
American Consumers Ended Up Bearing a Greater Burden"
Donald Trump, the former President of the United States, mentioned Korean washing machines as a success story of his tariff policy during his previous term. However, reports have emerged that while the policy failed to fundamentally revitalize the local economy, the burden on consumers significantly increased.
The Wall Street Journal (WSJ) of the United States reported on the 8th (local time), citing Samsung Electronics' washing machine factory in Newberry County, South Carolina, as an example.
Earlier, President Trump referred to his imposition of high tariffs on imported washing machines produced by Korea's Samsung and LG in a speech at the end of last month as an achievement.
Samsung Electronics washing machine factory in Newberry County, South Carolina, USA [Image source=Provided by Samsung Electronics]
In 2018, President Trump activated a “safeguard” (emergency import restriction) through the U.S. International Trade Commission (ITC), imposing additional tariffs of up to 50% on imported large household washing machines exceeding 1.2 million units annually.
At the time, President Trump emphasized, “If I had not imposed tariffs on washing machines and dryers during my first administration, all the companies in Ohio would have gone bankrupt,” adding, “Korea was dumping washing machines and such, so we started tariffs at 50%, then raised them to 75%, and even 100%.”
Samsung Electronics’ factory in Newberry County was established in 2017 in line with the tariff policy promises during the first Trump administration. Before Samsung’s factory was built, this area was an agricultural region where the textile industry thrived.
Currently, 1,500 workers are employed at the factory, with wages reported to be $16 to $17 per hour, which is twice the state minimum wage of $7.25. Newberry County collects about $1 million (approximately 1.45 billion KRW) in tax revenue annually from this site.
WSJ further reported that two additional Korean parts factories relocated to Newberry County, creating more jobs. The county has experienced a “Samsung effect,” with residential land prices rising following the establishment of Samsung’s factory.
However, WSJ analyzed that the establishment of Samsung Electronics’ factory did not fundamentally change the local economy.
The Samsung factory is located near a highway, and most workers live outside Newberry County. As a result, the population of Newberry County has remained steady at 39,000 over the past 15 years.
Samsung Electronics washing machine factory in Newberry County, South Carolina, USA [Image source=Provided by Samsung Electronics]
Newberry County’s annual employment growth rate has doubled to 1.6% since Samsung’s entry, but it still remains below the state average.
WSJ reported that, rather, the tariffs imposed during Trump’s first term caused washing machine prices to rise overall, increasing the burden on American consumers.
According to a research paper published in the 2020 American Economic Review, while 1,800 new jobs were created due to the tariffs on washing machines, the price of washing machines rose by about 12% ($86?$92) in 2018 alone, increasing consumer costs by $1.5 billion annually.
WSJ pointed out, “This means that each job costs more than $800,000 (approximately 1.16 billion KRW).”
Meanwhile, the safeguard imposed by the Trump administration ended in February 2023 during President Joe Biden’s administration.
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