Revoking Tariffs Would Be “Ill Conceived and Inherently Flawed,” AAM President Scott Paul Tells ITC

Paul testified at virtual hearing examining Section 232 and 301 trade enforcement actions — and he urged officials to keep the measures in place.

The International Trade Commission (ITC) is hosting a marathon three-day hearing this week looking at the impacts of the Section 232 and Section 301 tariffs. It’s part of a lengthy investigation that the agency is conducting on the trade actions, and it will all wind up in a big report that the ITC is required to submit to Congress by March 15, 2023.

Anyway, a whole bunch of industry representatives, lawyers, labor leaders, and even policymakers are testifying before ITC commissioners this week to offer their perspectives, and our own President Scott Paul came to the virtual podium on Thursday.

Paul pointed out that the Section 232 tariffs on steel and aluminum imports “successfully improved industry conditions while spurring significant investments and jobs.” Meanwhile, the 301 tariffs placed on Chinese imports to response to “Beijing’s predatory and discriminatory economic practices” remain a critical negotiating tool in the ongoing effort to level the playing field for American workers.

“Abandoning or eroding the Section 301 tariffs would discard our negotiating leverage, be the optimal outcome for President Xi, and subject U.S. producers and American workers to a flood of imports,” Paul said. “Rolling back Section 301 tariffs, however, would do little to nothing to address inflation, and would, instead, benefit China’s Communist Party and China’s manufacturing sector, which would make up the difference by increasing prices.”

While the ITC report won’t likely be released until next spring, the Biden administration is said to be considering revoking at least some of the tariffs in a [misguided] attempt to address inflation. As Paul noted in his ITC testimony, even anti-tariff organizations like the Peterson Institute for International Economics reported that lifting tariffs won’t do all that much about inflation, predicting removing the tariffs “could” cut Consumer Price Index (CPI) inflation by just 0.26%.

There is likely to be movement on the China front soon, as President Biden said on Wednesday that he is likely to speak with Chinese leader Xi Jinping within the next 10 days.

“Lifting retaliatory measures before they induce reforms would be ill conceived and inherently flawed given China’s continued reliance on market distorting policies, acts, and practices,” Paul warned Thursday. “U.S. companies would be subjected to a flood of imports. It is of the utmost importance to the American manufacturing sector that the United States continue pressing for reforms that address China’s unreasonable and discriminatory acts, policies, and practices.”

You can read Paul’s testimony in its entirety here. And don’t forget to tell the Biden administration to keep tariffs in place.