Trade Cases

Tariff Reform Coalition: Time to Roll Back Section 232

March 26, 2021

It’s time to roll back the Section 232 tariffs on steel and aluminum imports, and the Section 301 tariffs on imports from China, which are inflicting significant harm on U.S. businesses and workers, argued the National Foreign Trade Council on Wednesday in an appeal to the Biden administration. The NFTC’s briefing paper, “Why Recent Tariff Increases Harm Our Economy,” was signed by the Tariff Reform Coalition, a group of 37 manufacturing and agricultural trade groups in an appeal to President Biden to reconsider the high Trump-era tariffs.

Comments from Biden administration officials have been generally supportive of the tariffs and the American jobs they protect, but have not stated definitively if they will support the trade actions long term.

Opponents argue that the tariffs, and the retaliation they prompt by foreign governments, puts U.S. manufacturers, distributors and farmers at a disadvantage to foreign competitors and threaten far more jobs than they protect, at a time when American businesses are already struggling with the economic downturn caused by COVID-19.

“As American businesses and workers struggle with the effects of the pandemic, this is the worst possible time to turn inward and continue maintaining high trade barriers, including Section 232 and Section 301 tariffs,” the group wrote in its appeal. “The Section 232 tariffs on steel and aluminum should be removed as soon as possible. There are ample authorities under other trade laws, recognized as legitimate under WTO agreements if properly applied, to address problems of steel and aluminum subsidies or global overcapacity in a way that would minimize adverse impacts on the majority of U.S. companies and workers.”

Emotions are strong on both sides of the issue, with steel industry trade groups adamantly urging the administration to stay the course on Section 232, despite the record high steel prices in the U.S. The American Iron and Steel Institute and the Steel Manufacturers Association, declared their support this week of a new study by the Economic Policy Institute that found the Section 232 tariffs put in place in 2018 have been effective in countering trade-distorting practices by China and other nations and should be kept in place until a permanent solution to the chronic problem of excess global steel production capacity is achieved.