Tariff tensions flare as U.S.–China talks loom and budget battle heats up

Tariff talks are back in the spotlight this morning, as rising tensions between the U.S. and China threaten to derail ongoing trade negotiations.

(NBC)- Tariff talks are back in the spotlight this morning, as rising tensions between the U.S. and China threaten to derail ongoing trade negotiations. Both countries are accusing each other of violating terms that had previously led to a temporary scaling back of steep tariffs. White House officials say direct engagement between President Donald Trump and Chinese President Xi Jinping will be necessary to reset the process.

“I can confirm that the two leaders will likely talk this week,” said White House Press Secretary Karoline Leavitt.

This comes as President Trump’s decision to double tariffs on steel and aluminum imports to 50 percent is set to take effect tomorrow. “These measures will further secure the steel industry in the United States,” said President Trump.

“American businesses are paying these tariffs,” said Terry Goodin, CEO of Sportaflex. “I just know that we have nine people, and if we don’t get some relief soon, we’re going to have three people.”

The tariff standoff is unfolding as the Senate takes up President Trump’s sweeping budget bill this week. The legislation, which has already passed the House, includes extensions of major tax cuts along with increased defense and immigration spending. Some Republican senators are raising concerns about the rising deficit and a lack of offsetting spending cuts.

“I would be very surprised if the bill at least is not modified in a good direction,” said Sen. Rand Paul (R-KY).

Senate Majority Leader John Thune (R-SD) says the goal is to deliver the final bill to the president before the Fourth of July. Meanwhile, protesters have taken to Capitol Hill to oppose proposed cuts to Medicaid and food assistance programs contained in the bill.