Bipartisan Bill Introduced That Could Allow Congress to Veto 232 Tariffs on Autos
Two Republicans and one Democrat introduced a bill in the Senate Aug. 1 that would stop a Section 232 tariff if majorities in both chambers don't want the tariff. Sen. Rob Portman, a former U.S. trade representative, is the author of the bill, co-sponsored by Sen. Joni Ernst, R-Iowa, and Sen. Doug Jones, D-Ala. Portman had been working for weeks to sign up co-sponsors (see 1807130019).
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However, for this congressional veto to stop the proposed auto tariffs, the bill -- and a House companion bill yet to be introduced -- must pass, and become law, before the Commerce Department takes action on autos and auto tariffs. The Commerce Department has not said when it will make its recommendation on auto tariffs. Once that recommendation is made, President Donald Trump has 60 days to act.
The changes to Section 232 of the 1962 Trade Expansion Act would also require the secretary of defense to determine if imports are a national security threat, and if the Pentagon says they are, then the Commerce Department secretary would have 100 days to make recommendations on how to restrict those imports. Only then could the president act.
The Ohio Republican's bill, called the Trade Security Act of 2018, would also add language to the original law's paragraph that says the president and commerce secretary "shall further recognize the close relation of the economic welfare of the Nation to our national security, and shall take into consideration the impact of foreign competition on the economic welfare of individual domestic industries; and any substantial unemployment, decrease in revenues of government, loss of skills or investment, or other serious effects resulting from the displacement of any domestic products by excessive imports shall be considered, without excluding other factors, in determining whether such weakening of our internal economy may impair the national security."
The law would now say "shall take into consideration the impact of foreign competition on the economic welfare of individual domestic industries, the production of which is needed for national defense requirements and critical infrastructure in the United States." Unlike Sen. Bob Corker's proposal (see 1807120023), this bill would not change the Section 232 tariffs on steel and aluminum.
Sen. Doug Jones issued a statement in a press release that said: "We cannot resolve perceived trade imbalances by accusing our allies of being a threat to our national security. If a trading partner is suspected of undermining our national security, that claim needs to be thoroughly investigated by those with relevant expertise in the Department of Defense. Unfortunately, the current process led by the Department of Commerce has been misused to target important job-creating industries in Alabama like auto manufacturing."
The bill would return the 1962 law to its original intent, to give the government a tool to address "genuine threats to national security," the press release said. "As a former USTR, I know that misusing our trade tools not only hurts our exports and our manufacturers, but also our consumers, so I urge my colleagues to support this bipartisan legislation," Portman said in his press release.
The U.S. Chamber of Commerce praised the bill. Neil Bradley, chief policy officer for the Chamber, said, "The business community was encouraged by news of new trade talks with the EU and the resumption of dialogue to modernize NAFTA, but concerns remain about the appropriate use of damaging tariffs against our closest allies and best customers. As new tariffs against automobiles and auto parts are being considered, this proposal to reaffirm Congress's exclusive constitutional authority to regulate foreign trade is a welcome development."