Amazon triggered a brief storm after reports leaked that it was considering imposing tariff price increases on store items. The White House blasted them, and Amazon backed down. However, this reflects the bind that Chinese retailers put on American consumers and our companies.

Jeff Bezos and Amazon backed down and said the proposed policy to "[display] the impact of tariffs during its online checkout process" was not going into effect and was only being discussed for its super-cheap subsidiary, "Haul." The price increases were not being discussed for the Amazon site.

That differentiation is critical in understanding what is happening. Haul is a distinct store where everything is under $20 and directly challenges ultra-cheap Chinese retailers TEMU and SHEIN.

The site was launched last November, attempting to cut into the market dominated by Chinese retailers. TEMU and SHEIN exploited what's known as the "de minimus" loophole, which allowed them to ship cheap goods at low to no cost. One of the Trump administration's first steps in the trade war was closing this loophole, driving a stake through the TEMU/SHEIN business model.

TEMU and SHEIN also face the impacts of Trump's tariffs on China. As a result, these Chinese retailers have been pushed over a cliff, facing an existential threat to their very business model.

CNBC reports, "Temu has sharply slashed its online ad spending in the U.S. since Trump announced sweeping tariffs. Temu's ranking in Apple's app store has since plummeted to No. 73, after consistently ranking in the top 10, according to Sensor Tower data. Shein is currently at 54, down from 15 last month."

If you're like me, you noticed a few years ago that TEMU and SHEIN bought out influencers across social media. Those "sponsored" posts have dried up, and with that, so has the advertising budget, and TEMU and SHEIN can no longer compete on an unfair playing field.

Where does that impact Amazon? Haul was a copy of the TEMU and SHEIN business model. Amazon used a similar process to ship cheap goods from China. Over the weekend, TEMU and SHEIN started displaying tariff impacts on their prices.

CNBC noted, "Chinese e-tailer Temu has started adding "import charges" of about 145% in response to President Donald Trump's tariffs. The fees, which began cropping up over the weekend after price hikes went into effect on Friday, cost more than the individual products consumers are buying and can more than double the price of a typical order."

The leaked Amazon policy was just a copy of what its competition was already doing. China is having its businesses blame Donald Trump in its trade war, similar to when it cut off TikTok when the new law banning it went into effect.

That's left Amazon in a bind. Their subsidiary struggles to compete and now faces higher prices because it sources most of its products from China. It was also a distant competitor to TEMU and SHEIN in the ultra-cheap competition.

In my area of the world, TEMU and SHEIN have driven similar U.S. companies out of business. Scratch-and-dent retailers like "Bargain Hunt" and other versions of that business model can't compete with these dirt-cheap Chinese companies. People flock to the dirt-cheap retailers, which the Chinese government underpins.

And now, those same Chinese companies are using their market leverage to drive policy in America. China is using its leverage, and like most competing companies, Amazon planned to follow to avoid losing an advantage. That all came crashing down in the heat of political backlash.

Amazon wants Haul to succeed, but they don't want to destroy their entire brand in the process. TEMU and SHEIN operate under the CCP - they push the communist party's propaganda - by force. None of these massive Chinese international corporations is operating freely.

We've witnessed this firsthand, with China stepping in to check on attempts to control TikTok in the United States. We know the Chinese deploy censors and other things on their networks and are credibly accused of using all these companies to steal the personal data of Americans.

From a national security standpoint, killing off these Chinese retailers is a net positive for the United States. It prevents the CCP from using loopholes to undercut American companies and keeps American data out of the Communist Party's hands.

TEMU and SHEIN jacking up their prices hurts the Chinese economy and cripples a parasitic business model that China has used to latch on to other American industries. Amazon has tough decisions about Haul, but it should not be forced into following the Chinese example due to the pressure they exert.

This retailer spat is another volley in the economic war with China. America needs to focus on defeating another communist regime.