A bill that could undo the steel and aluminum tariffs -- and would prevent any other Section 232 tariffs from taking effect without congressional approval -- needs more support to convince Senate leadership to allow a vote on it, its author acknowledged. Senate Majority Leader Mitch McConnell of Kentucky said repeatedly last year that efforts like this would be vetoed, and therefore are a waste of time. Sen. Pat Toomey, R-Pa., said that having 11 co-sponsors on the day of introduction is strong, but he added: "We obviously need to have much broader support for this in order to persuade Senator McConnell to devote floor time to it."
The New Democrat Coalition, a caucus of generally pro-free-trade Democrats in the House of Representatives, has not coalesced around the NAFTA replacement, according to J.D. Grom, executive director of the group, speaking Jan. 29 on a panel at the Washington International Trade Association annual conference. "Members are still working through where we're at on the agreement," he said, but they are clear that they will be unhappy if President Donald Trump tries to withdraw the U.S. from NAFTA to force a yes vote on its replacement. "We don't want to be in a hostage situation," he said.
Bipartisan bills were introduced in the House and Senate to give Congress a veto over potential Section 232 tariffs on autos and auto parts and the ability to rescind the tariffs and quotas on steel and aluminum. The push in the Senate is led by Sen. Pat Toomey, R-Pa., who also tried to move a similar bill last year, as well as Sen. Mark Warner, D-Va.
The Congressional Budget Office says that the fact that the administration imposed additional tariffs on 12 percent of all imports will reduce GDP -- after adjusting for inflation -- by about 0.1 percent each year through 2029, assuming all the tariffs stay on. The projection also assumes that the 10 percent tariffs on about $200 billion in Chinese imports do not rise to 25 percent. "Tariffs reduce domestic GDP mostly by raising the prices paid by U.S. consumers and businesses, which reduces the purchasing power of domestic consumers and increases the cost of business investment," the CBO wrote in a report released Jan. 28. They said reduced exports, due to retaliatory tariffs, also contribute to the economic drag, though both are partly offset by increases in domestic production.
Sen. Ron Johnson, R-Wis., and a half-dozen Republican colleagues told President Donald Trump that the decline in the stock market since October is due partly to higher tariffs, and they used his own words against him to argue that steel and aluminum tariffs should be lifted on Canada and Mexico. Their letter, sent Jan. 28, starts by quoting a Trump tweet from March 2018 that said steel and aluminum tariffs in North America "will only come off if a new & fair NAFTA agreement is signed." They noted that he signed the new NAFTA at the end of November, but that the tariffs haven't been lifted.
A House bill that would limit the ability of the president to unilaterally raise tariffs or block imports without congressional approval was reintroduced by Rep. Warren Davidson, R-Ohio, and 10 co-sponsors, including prominent members of the Freedom Caucus. Davidson calls the bill the Global Trade Accountability Act, and he first introduced it in March 2018. Its likelihood of becoming law is slim, because Senate Majority Leader Mitch McConnell, R-Ky., has repeatedly said he will not bring forward bills he expects the president would veto.
House Ways and Means Chairman Rep. Richard Neal, D-Mass., told Worcester, Massachusetts, journalists, that there once were more union manufacturing jobs in Worcester, that provided stability and a good standard of living. Now, the rapid advancement of technology and globalization are challenges, he said. But, he added, "I don't think you can tell the young people here in the city of Worcester ... that globalization is going to retreat. So I think protectionism in terms of trade is a mistake, and I think the idea we can't compete in the international trade arena is a mistake."
The U.S. Reciprocal Trade Act, a bill that would give the president the ability to raise tariffs above the bound rate to match trading partners' levels, was introduced by Rep. Sean Duffy, R-Wis., on Jan. 24. The bill has 18 co-sponsors, all Republicans.
Reps. Tim Ryan, D-Ohio, and Mike Conaway, R-Texas, reintroduced The Fair Trade with China Enforcement Act, a companion bill to Senate Bill 2, which was reintroduced at the beginning of the month by Sens. Marco Rubio, R-Fla., and Mark Warner, D-Va. Ryan's announcement Jan. 22 said: "This bipartisan legislation works to safeguard American assets from Chinese influence and possession, as well as protect American businesses from China’s tools of economic aggression."
A coalition of 70 groups -- including Public Citizen, the AFL-CIO and a nonprofit focused on reforming intellectual property to serve the poor -- is asking Congress members to cut language from the new NAFTA that would require Mexico, Canada and the United States to grant a 10-year exclusivity period to biologics. Their letter, distributed Jan. 22, says, "NAFTA 2.0 includes terms that would lock in place existing U.S. policies that have led to high medicine prices, undermining the authority of this and future Congresses to implement important reforms to expand generic and biosimilar competition, lower medicine prices and expand access. This is the case because NAFTA 2.0 includes expansive terms relating to patent and other non-trade policy matters to which the U.S. Congress will be obliged to conform our domestic policies." Currently, U.S. law gives 12 years' protection to biologics.