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Thread: US Steel & Aluminum Tariffs

  1. #46
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    Quote Originally Posted by Ironduke View Post
    "Trade wars are good, and easy to win," he wrote on Twitter.
    Following the announcement of President Trump, there is a risk of a serious trade dispute between the United States and the rest of the world, including the EU. President Trump has recently said, and I quote: 'trade wars are good, and easy to win'. But the truth is quite the opposite: trade wars are bad, and easy to lose. For this reason, I strongly believe that now is the time for politicians on both sides of the Atlantic to act responsibly. [...] And, if necessary, to protect Europeans against trade turbulence, including by proportionate responses in accordance with the WTO.

    - Donald Tusk, President of the EC.

  2. #47
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    Best quote I've read so far about this Trumpkin brainstorm was Junker who said "We can do stupid too".

  3. #48
    Former Staff Senior Contributor Ironduke's Avatar
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    Trump tariff promise prompts U.S. steel company to restart Illinois plant

    U.S. Steel Corp. announced Wednesday it will restart one of two blast furnaces at its steel mill in Granite City, Ill., and rehire approximately 500 employees as a result of a planned 25 percent tariff President Donald Trump wants to impose on steel imports.

    “Our Granite City Works facility and employees, as well as the surrounding community, have suffered too long from the unending waves of unfairly traded steel products that have flooded U.S. markets,” U.S. Steel President and CEO David Burritt said in a statement.

    The Pittsburgh-based steel company said the additional capacity it is creating will support an anticipated increase in demand for domestically produced steel. The plan to restart the blast furnace will take up to four months and will be done in cooperation with leadership from the United Steelworkers labor union, the company said.
    https://www.politico.com/us-steel-corp-illinois-plant

    White House says Trump may exempt Canada, Mexico from tariffs

    The White House seems to be softening its stance on steel and aluminum tariffs.

    When asked if countries will be able to get exemptions from tariffs, Press Sec. Sanders opened the door to the possibility.

    "We expect that the President will sign something by the end of the week. And there are potential carve-outs for Mexico and Canada based on national security and possibly other countries as well based on that process," she said at a press briefing Wednesday. "That will be a case by case and country by country basis. It would be determined whether or not there is a national security exemption."

    President Donald Trump said last week he plans to impose 25 percent tariffs on steel imports and 10 percent tariffs on aluminum. The announcement set off a wave of uncertainty in the financial markets and fears they would be a blanket move instead of targeted.
    https://www.cnbc.com/2018/03/07/whit...m-tariffs.html

  4. #49
    Former Staff Senior Contributor Ironduke's Avatar
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    Curious if anybody has any ideas to if/how this section of the law could be/could have been used instead of what Trump is relying on as a legal basis for his actions:

    Sec. 231. PRODUCTS OF COMMUNIST COUNTRIES OR AREAS

    The President shall, as soon as practicable, suspend, withdraw, or prevent the application of the reduction, elimination, or continuance of any existing duty or other import restriction, or the continuance of any existing duty-free or excise treatment, proclaimed in carrying out any trade agreement under this title or under section 350 of the Tariff Act of 1930, to products, whether imported directly or indirectly, of any country or area dominated or controlled by Communism.
    I mean, if he really wanted to go after China instead of pissing off our allies with what's increasingly looking to be likely, a counterproductive trade war relying on Section 232 of the law, how much water would section 231 hold as a basis for narrowly targeted China-specific actions? And what kind of leverage does China have to retaliate against such actions?

  5. #50
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    China is not why he was helped (by Moscow). Mess up the transatlantic alliance and degrade the US and and other intelligence institution and law enforcement agencies is his job. He is a spoiler; that is all they need. Moscow has no positive program and neither really does Trumpkin; where is the infrastructure renewal plan? Apparently forgotten.

  6. #51
    Senior Contributor DOR's Avatar
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    Quote Originally Posted by Ironduke View Post
    Curious if anybody has any ideas to if/how this section of the law could be/could have been used instead of what Trump is relying on as a legal basis for his actions:


    I mean, if he really wanted to go after China instead of pissing off our allies with what's increasingly looking to be likely, a counterproductive trade war relying on Section 232 of the law, how much water would section 231 hold as a basis for narrowly targeted China-specific actions? And what kind of leverage does China have to retaliate against such actions?
    Aside from the small matter of both the US and the PRC being full members of the WTO, and therefore having treaty obligations that supercede domestic law (i.e., it’s a frigging TREATY), I suspect there’d be a problem defining ‘communist countries.’
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  7. #52
    Former Staff Senior Contributor Ironduke's Avatar
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    Quote Originally Posted by DOR View Post
    Aside from the small matter of both the US and the PRC being full members of the WTO, and therefore having treaty obligations that supercede domestic law (i.e., it’s a frigging TREATY)
    Yes, and the exact same thing could be said for the measures he currently wants to undertake, except that Trump wants to violate treaty obligations even more broadly with every country that is a party to the WTO.

    Trump has already decided he's in the business of violating trade treaties - so why not, hypothetically, use the preceding section as a basis for trade measures instead?

    I suspect there’d be a problem defining ‘communist countries.’
    I suspect the single-party state ruled by the Communist Party of China would fit within that definition.

  8. #53
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    I seem to remember Canada being the weak link the last time this was attempted...Industry just bought from Canada......Canada are rubbing their hands I bet.....plus all Chinese and EU steel will just divert via Canada.....mega bucks.!!!!!! North of the border....

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    From Reuters: https://www.reuters.com/article/us-u...-idUSKCN1GE10I

    Following are the top steel exporters to the United States with their corresponding percentage of total U.S. steel imports:

    1. Canada 16.7 percent

    2. Brazil 13.2 percent

    3. South Korea 9.7 percent

    4. Mexico 9.4 percent

    5. Russia 8.1 percent

    6. Turkey 5.6 percent

    7. Japan 4.9 percent

    8. Germany 3.7 percent

    9. Taiwan 3.2 percent

    10. China 2.9 percent

    11. India 2.4 percent

    Source: Wood Mackenzie

    Yup, steel tariffs is how you hurt China. Makes perfect sense in Trumpland. Xi-Jinping must have laughed his ass off when he heard about this.

  10. #55
    Former Staff Senior Contributor Ironduke's Avatar
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    I'm surprised that Russia is 8.1%.

    Whatever happened to China, currency manipulation, "so unfair"?

    https://www.nationalreview.com/2018/...tionism-china/
    China Trade Has Been a Bust
    Donald Trump’s tariffs are a comically inept misfire if their true target is China.

    There’s already a trade war, and it’s being waged by Beijing.

    China’s ascension to the World Trade Organization nearly 20 years ago has failed in its large-scale strategic objectives. It hasn’t created a liberalizing regime or a free-market economy in China; in fact, it hasn’t even created a China ready and willing to abide by the norms of free trade.

    The regime of Xi Jinping hasn’t been pushed toward democratic reforms by a rising middle class. China still champions state-led, rather than market-led, capitalism. And it takes advantage of the WTO, using non-tariff barriers and industrial policy, to push mercantilist policies.

    President Donald Trump’s prospective tariffs on steel and aluminum have put renewed focus on China trade, although the tariffs are a comically inept misfire if their true target is China. The rubric for the levies could be: “How to lose a trade war with China in one easy step.”

    The tariffs don’t really affect China, from which we import only about 3 percent of our steel. Meanwhile, they send the message that the U.S. government is lurching toward protectionism, and alienate our allies. They run exactly counter to what would be a sound approach to Chinese mercantilism, as a compelling report by the Information Technology and Innovation Foundation underscores.

    The report argues that there are two ways to wave the white flag on China trade — one, favored by the Washington establishment, is to accept Chinese cheating as the way of the world; the other, perhaps favored by Trump, is to adopt a mercantilism of our own. Both would concede to the Chinese an outsize role in forging new, less desirable rules of the road in the global trading system and poorly serve America’s interests.

    A better approach begins with acknowledging that China is a unique problem. For all of Trump’s complaints, Mexico isn’t pursuing a well-honed strategic agenda of exploiting the global trade system at the same time it undertakes an aggressive neoimperialist foreign policy. Only China is doing that.

    China isn’t the first developing country to adopt a policy of maximizing exports. What makes it different is its sheer ambition and its size, which gives it leverage over foreign companies and considerable international influence.

    What’s the harm to the U.S.? Yes, technology accounts for a large share of job losses in manufacturing in recent decades. Yes, lower-end manufacturing would have left our shores regardless. But there is no doubt that China’s practices have harmed the U.S. manufacturing sector, and that Beijing works to block higher-value-added exports from the U.S. and is pursuing a comprehensive strategy to dominate in advanced industries.

    By no means should we emulate China. We should continue to pursue free trade as a policy, not as a theology that prevents us from acknowledging that there is such a thing as unfair trade.

    The ITIF report urges using the global free-trade regime against China. That means bringing more actions against China in the WTO and working to update the rules to capture Chinese cheating. It means joining, and influencing, a multilateral agreement like the Trans-Pacific Partnership. It means forging bilateral agreements with up-to-date standards that reinforce principles that China undermines.

    We obviously can’t do this alone. We’d have to lead an alliance of international partners to pressure China on specific practices, with tailored consequences if we get nowhere.

    Such a broad-based effort to crack China’s mercantilism wouldn’t be protectionist, but the opposite. There is obviously no chance of doing this, though, if we are engaged in an absurd cycle of tit-for-tat tariffs with the likes of the EU.

    Trump can have emotionally satisfying tariffs to scratch his protectionist itch, or he can have a strategy to muster an alliance of truly free-trade partners to pressure China. He can’t have both — and you can be sure China knows which option it prefers.
    Last edited by Ironduke; 09 Mar 18, at 18:39.

  11. #56
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    U.S. expected to impose up to $60 billion in China tariffs by Friday: sources

    WASHINGTON (Reuters) - The Trump administration is expected to unveil up to $60 billion in new tariffs on Chinese imports by Friday, targeting technology, telecommunications and intellectual property, two officials briefed on the matter said Monday.

    One business source, who has discussed the issue with the administration, said that the China tariffs may be subject to a public comment period, which would delay their effective date and allow industry groups and companies to lodge objections.

    This would be considerably different from the quick implementation of the steel and aluminum tariffs, which are set to go into effect on March 23, just 15 days after President Donald Trump signed the proclamations.

    A delayed approach could allow time for negotiations with Beijing to try to resolve trade issues related to the administration’s “Section 301” probe into China’s intellectual property practices before tariffs take effect.

    The White House declined to comment Monday. China has vowed to take retaliatory measures in response.
    https://www.reuters.com/article/us-u...-idUSKBN1GV31E

  12. #57
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    Looks like Walmart, Amazon and Apple will neuter the $60 billion down to something like $6 billion.

  13. #58
    Turbanator Senior Contributor Double Edge's Avatar
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    Interesting to see how this turns out. A trade surplus with China means leverage. How does China retaliate back

    End of the day they sell to the US far more than the other way around
    Last edited by Double Edge; 21 Mar 18, at 23:52.

  14. #59
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    Quote Originally Posted by Double Edge View Post
    Interesting to see how this turns out. A trade surplus with China means leverage. How does China retaliate back

    End of the day they sell to the US far more than the other way around
    The vast majority of US imports from China are made by foreign-invested companies that were either founded in China or moved there from Hong Kong, Taiwan, Korea or Japan. We're talking something on the order of 60-70%.
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    Doing Stupid

    A Working-Class Remedy That Hasn't Worked Out

    by Eduardo Porter, The New York Times International Edition, March 22, 2018

    Tupelo fell hard for Donald Trump. The blue-collar enclave in northeastern Mississippi — birthplace of Elvis Presley and the American Family Association — was once home to a vibrant business in upholstered furniture. But as Chinese imports flooded in, the local economy buckled.

    There are fewer jobs in Tupelo today than there were at the millennium. Middle-income families are making almost 20 percent less, after inflation, than they did then. Trump’s offer to build a wall against Chinese imports was just what Tupeloans wanted to hear.

    Republicans could not lose in this deep red enclave in the buckle of the Bible Belt. Still, in the 2016 election, Trump carried Lee County, where Tupelo sits, by a 38-percentage-point margin over Hillary Clinton — 9 percentage points more than Mitt Romney’s lead over Barack Obama four years before.

    And yet it’s not working out great for the working men and women of Tupelo. Indeed, Trump’s first big trade barrier — tariffs against steel and aluminum imports — is, again, threatening to undermine their livelihood.

    For every job in Tupelo producing steel or aluminum, there are 200 in industries that consume those metals that could be put at risk as tariffs push up prices, according to research from Jacob Whiton and Mark Muro of the Brookings Institution.

    This is true across the country. The lesson the White House has yet to figure out is that the tariffs meant to protect the businesses that make these metals will end up hamstringing the industries that rely on them.

    The United States has been here before. When President George W. Bush imposed emergency tariffs on imported steel in 2002, prices of steel shot up. According to a survey by the International Trade Commission, almost 1 in 5 furniture and hardware producers, as well as a third of electrical appliance makers and 1 in 10 auto-parts suppliers, responded by relocating production abroad. Another study found that industries that use steel lost 200,000 jobs. That is more than all the jobs in the steel industry itself.

    All sorts of industries use aluminum and steel. There are cutlery makers and producers of railway cars; furniture manufacturers and pickled vegetable canners; tire makers and wire makers and manufacturers of all sorts of auto parts. Whiton and Muro’s research underscores just how big a footprint the steel- and aluminum-consuming industries have compared with steel and aluminum producers.

    Steel- and aluminum-producing industries employ some 95 workers in the Tupelo commuting zone — an area centered on Tupelo that comprises Lee and a clutch of five smaller counties, according to Whiton and Muro’s analysis.

    By contrast, 20,294 people in the area — almost 1 in 4 — work in industries that consume either metal. There are the workers assembling lawn mowers at the MTD factory and the workers at Jesco, a steel fabrication plant that serves the construction industry. There are the workers slapping together Corollas at the Toyota plant in Blue Springs a few miles northwest, and their colleagues close by at Toyota’s auto parts manufacturing plant.

    An analysis from the Council on Foreign Relations concluded that Trump’s tariffs could kill up to 40,000 jobs in the auto industry alone.

    What’s particularly ironic is that the blow from the new tariffs will be felt most acutely by workers who voted for Trump. No place in Virginia swung for the president more than Bland County, where 82 percent of voters chose Trump. The county supports 11 steel- and aluminum-producing jobs, according to Muro and Wilton’s data. Steel- and aluminum-consuming industries, by contrast, employ 468.

    In Mercer County, Ohio, another Trump stronghold, consuming industries employ eight times as many workers as producers. Then there is Macomb County, stretching northeast from Detroit. After voting twice for Barack Obama, Macomb’s voters gave the county — and arguably the state of Michigan — to Trump. He won the county by 48,348 votes. His margin in the entire state was only 13,107.

    Trump’s campaign strategy was almost custom cut for Macomb’s overwhelmingly white and blue-collar voters. His appeal to protect the homeland from foreign goods resonated in this hub of the auto industry, where robots have replaced much of the working class. Since 2000, Macomb has lost a third of its jobs in manufacturing, the industry that is still the county’s biggest employer.

    The problem with Trump’s remedy, as far as Macomb’s workers are concerned, is that this manufacturing industry uses lots of steel. According to the Brookings data, almost 16 percent of the jobs in the county are in industries that consume steel and aluminum, while 0.2 percent — 478 jobs — depend on producers.

    The demand for protectionism from Trump’s voters comes from real pain. Macomb and Tupelo have lost much of what they called the middle class when good jobs in manufacturing industries disappeared.

    Seminal work by David Autor of the Massachusetts Institute of Technology, David Dorn at the University of Zurich and Gordon Hanson at the University of California, San Diego, shows that workers in counties whose industries were exposed to competition from China lost jobs and suffered declines in wages.

    For instance, the surge of Chinese furniture into the United States between 1990 and 2007 amounted to more than $43,000 per each American worker in the business. In the Tupelo commuting zone, where 1 in 5 workers made furniture, it hurt.

    Autor, Dorn and Hanson estimated that, in total over the period, Tupelo’s workers suffered a $14,120 “China shock” — $14,120 worth of goods per worker that, with other things remaining equal, would have been made by the area’s labor force had they not been imported from China. On average, every $1,000 worth of “shock” reduced the household wage and salary income for working-age adults by $549 per year, they estimated.

    These workers are right to be angry. Policymakers of both parties have long ignored their plight, espousing “free trade” on the grounds that it enhances overall economic growth, while doing next to nothing to help those on the losing side.

    And still, protectionism is the wrong tool to improve workers’ lot. It will do nothing to stop automation, for one. Critically, while perhaps protecting some workers in one, narrow industry, it will probably hurt many others.

    To paraphrase Paul Krugman, if China is a truck that ran roughshod over the workers of Tupelo, Trump’s protectionism amounts to putting the truck’s gear in reverse and running them over again.
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