Senate Majority Leader Mitch McConnell broke his silence on steel and aluminum tariffs, which have sparked strong reactions from Republicans in both chambers since the surprise announcement last week (see 1803010029). "There is a lot of concern among Republican senators that this could metastasize into a larger trade war, and many of our members are discussing with the administration just how broad, how sweeping this might be," he said at a news conference March 6. He noted that President Donald Trump has suggested an exemption for Canada and Mexico might be tied to concessions in NAFTA renegotiations. "From a Kentucky point of view, NAFTA's been a big one, we've benefited from it in every way," the senator from Kentucky added. McConnell said that if the tariffs create disruption, "it could send our economy in the wrong direction."
House Ways and Means Committee Chairman Kevin Brady, R-Texas, said the bipartisan meeting of Congress members and President Donald Trump on Feb. 27 was a productive discussion of how the American economy can be strengthened through trade policies. Tax reform is creating more investment and wage gains, he said, adding that “my goal is to continue those positive trends through strong trade agreements to improve the lives of America’s workers, consumers, and job creators. In particular, I will continue to work with President Trump to deliver a modernized NAFTA -- one with tough obligations that are strictly enforced through effective and binding dispute settlement." U.S. Trade Representative Robert Lighthizer has said he wants the binding investor-state dispute settlement mechanism in NAFTA to be repealed (see 1711060024).
The House Ways and Means Committee will consider whether all enforcement tools under the Trade Facilitation and Trade Enforcement Act are being used, the committee said in a letter outlining the year's priorities. It will also be addressing fiscal year 2019 budgets for the Office of the U.S. Trade Representative, CBP and the International Trade Commission in the coming months. In its "views and estimates" letter on the budget, the committee noted that it will be working closely with the Trump administration to modernize NAFTA and on U.S.-Korea Free Trade Agreement negotiations. Also, the committee will work with the administration "to determine appropriate partners for additional trade negotiations as well as negotiating priorities," the letter said. To be reviewed as well is the Synthetics Trafficking & Overdose Prevention (STOP) Act, which aims to end the importation of fentanyl and carfentanil through international mail.
After a visit at the White House, House Ways and Means Chairman Kevin Brady, R-Texas, told reporters at the Capitol that he told the president that the next step after tax reform is expanding export opportunities. "NAFTA was a good part of our discussions," he said Feb. 26. "I think there's potential major wins for President [Donald] Trump in NAFTA." Brady pointed to improvements in customs, digital trade, intellectual property and agriculture.
More than 20 conservative groups sent a letter asking Congress to pass bills to end sugar quotas and tariffs that "artificially inflate the price of sugar." The groups urged for movement on the Sugar Policy Modernization Act of 2017 (H.R. 4265) and the Senate companion bill (S. 2086). There have been no hearings on either bill since introduction in November. "The federal government establishes a minimum price for sugar in the U.S., which averages roughly double the world price," said the groups, led by the Council for Citizens Against Government Waste. "The sugar program is a hidden expense that costs small businesses and consumers $2.4 [billion] to $4 billion each year, according to the American Enterprise Institute. ... And the Department of Commerce estimated that for every sugar-producing job protected through high U.S. sugar prices, about three manufacturing jobs are lost."
All of the Democrats on the House Ways and Means Committee, except ranking member Richard Neal of Massachusetts, signed a Feb. 22 letter asking the chairman of the Trade Subcommittee to hold a hearing on NAFTA. The group says a hearing is necessary so that Congress can provide appropriate oversight of the U.S. trade representative's negotiations for a revised NAFTA. "More than 25 years ago, this Committee held the administrations negotiating the original NAFTA to a high standard of accountability, requiring United States Trade Representatives, Secretaries of Labor, and Administrators of the Environmental Protection Agency to appear before it multiple times," the lawmakers said. "American workers, businesses, and other stakeholders of today deserve as much accountability, if not more, from their negotiators and from their representatives."
Sen. Steve Daines, R-Mont., sent a letter to President Donald Trump praising him for suggesting the U.S. might join the Trans-Pacific Partnership if it could be made into a better agreement for the U.S. The Feb. 16 letter, signed by 24 other Republican senators, said increasing access to the 11 countries that are part of the TPP "can create widespread benefits to the U.S. economy" and counter Chinese influence.
The nominee for the Commerce Department's undersecretary for international trade may be able to get a vote on his confirmation before his wait reaches the 10-month mark. Gil Kaplan was nominated May 25, and the Senate Finance Committee unanimously approved him Sept. 7, but a hold from Minority Leader Chuck Schumer, D-N.Y., prevented his name from going to a full Senate floor vote (see 1710270015).
House Foreign Affairs Committee Chairman Ed Royce, R-Calif., introduced the Export Control Reform Act of 2018 on Feb. 15, he said in a news release. “In recent years, the government in Beijing has increasingly forced U.S. companies to hand over sensitive technology as a cost of doing business in China,” Royce said. The bill would help “modernize our regulatory control system and make clear the U.S. will not tolerate this behavior.” The bill also would repeal the lapsed Export Administration Act and replace “it with a modern, permanent statutory authority to better regulate U.S. dual-use and Department of Commerce-licensed military exports.” Ranking member Eliot Engel, D-N.Y., co-sponsored the legislation. Royce also released a detailed summary of the bill.
Steel industry interests testified Feb. 16 that duty evasion is pervasive, and that customs enforcement cannot keep up. "Customs and duty evasion and circumvention occurs because there's opportunity and because there's lack of enforcement," said Scott Paul, president of the Alliance for American Manufacturing. "Our border protections with regards to fairly traded goods are underfunded."