Senators Say Reductions in Section 301 Tariffs Planned

The text of a recent letter sent to the White House by Sens. Sherrod Brown, D-Ohio, and Bob Casey, D-Pa., suggests that they have been told there will be reductions in Section 301 tariffs, and they said in the letter that they have serious concerns that these reductions "will enable China and other global competitors to resume their anti-competitive activities without consequences. While not the subject of interagency review, we share similar concerns about reductions in 232 tariffs, as well as related actions that would undermine American steel and aluminum producers as a result of negotiations with the European Union on the Global Arrangement on Sustainable Steel and Aluminum."

Brown publicized the letter on Nov. 21; the senators opened by saying the administration is concluding its interagency review on the Section 301 tariffs. U.S. Trade Representative Katherine Tai, who leads the review, has said it will be done by the end of the year.

"We urge the Administration to maintain the Section 301 and Section 232 tariff regimes as we continue our work with partners and allies to forge a sustainable approach to trade policy that supports American workers and fair global economic competitiveness," they wrote, calling them essential to countering China's unfair trade practices. "A 2022 report from USTR on China’s compliance with the World Trade Organization only underscores that the underlying economic reasons and market conditions for why the tariffs were imposed have not changed," they wrote.

They said that the International Trade Commission found that both sets of tariffs "led to significant increases in domestic production in the tariffed industries that were analyzed."

That report (see 2303150042) said that most of the drop in imports of Chinese goods subject to Section 301 tariffs was replaced by other imports, but said there was some domestic production growth in the industries that competed with goods covered by the tariffs. Furniture and cabinetmaking increased by 7.5%, the report said. Semiconductors and electronic component manufacturing increased by 6.4%; however, motor vehicle part manufacturing only increased by 3%.

For Section 232 tariffs, the analysis said they increased domestic steel production by 5% and increased smelter utilization by about 15%, however, there was $3.4 billion less manufacturing across the most impacted metal consuming industries -- industrial machinery, cutlery and handtool factories; motor vehicle suspension and steering components; agricultural/mining/construction manufacturing, and metal fabricators.

The senators said that reducing Section 301's scope or tariff levels "could undermine efforts to shore up our domestic manufacturing and supply chains."

"Thank you for your attention to this important matter. We look forward to working with you to protect workers and communities, revitalize domestic manufacturing and industry, safeguard our national and economic security, and confront the threat posed by the Chinese government and other nonmarket economies," they wrote.