Ways and Means Chairman Concerned That USTR Will Re-Impose Aluminum Tariffs on Canada
The Office of the U.S. Trade Representative ought not to announce 10% tariffs on Canadian aluminum at the end of this week, just before the U.S.-Mexico-Canada Agreement goes into force, Ways and Means Chairman Richard Neal, D-Mass., told International Trade Today in an interview. The administration has not announced its intentions, but several outlets quoted unnamed sources saying the tariffs are coming if Canada doesn't agree to voluntary restrictions on its exports.
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USTR Robert Lighthizer testified at the Senate Finance Committee that there has been a surge of steel and aluminum imports from both Mexico and Canada since the tariffs were lifted on those countries, and that he was talking to those countries about it. Neal, who was speaking at the Capitol June 25, said with a laugh that Lighthizer “made it pretty clear” during his testimony last week in front of the committee that “his passion for imposing tariffs is not calmed.” Neal said he would be speaking to European Commission representatives later in the afternoon about tariffs.
Trade Subcommittee Chairman Earl Blumenauer, D-Ore., said, “I think it's ill-advised” for the administration to reimpose 10% tariffs on Canadian aluminum. He called it “part of the approach that they've taken to marginalize or alienate our trading partners, when, for instance, we need everybody with us, dealing with the real problems of China. And working with countries like Canada, or for that matter, Japan, building momentum in a coalition and working together cooperatively.”
When asked if the committee has any influence to prevent the tariffs, Blumenauer replied, “It depends on what they think they're going to try and run, and want to play nice.” He alluded to the trade negotiations with the United Kingdom, which, if they reach a conclusion, would require a vote in Congress to approve the trade deal.
“Canada? Give me a break. But I hope that there's still time to adjust an approach. I don't think that's where Lighthizer's heart is. He understands there are limited opportunities [for trade deals this year]. Better we start repairing these relationships.”
A Republican on the committee who has been critical of the exclusion process for the metals tariffs declined to call the reimposition's timing a mistake. Rep. Jackie Walorski, R-Ind., said, “I think we're in the same category as we've been in, which is this can't be a one-size-fits-all approach. For me, on oversight, I've got to be sure we continue to be fair.”
It wasn't just Ways and Means members who questioned the wisdom of reimposing tariffs on Canada under a national security statute. Rep. Joe Courtney, D-Conn., said that putting tariffs on Canadian aluminum is a bad way to start the USMCA. Courtney said that when the steel and aluminum tariffs were first imposed, he heard from many Connecticut manufacturers that they were a burden. He said no one has complained to him that aluminum products from Canada are surging since the tariffs were lifted.
“If there's a violation of dumping or improper government intervention, that should be challenged, but rushing to, you know, a blunt instrument like a tariff, you know, literally while the ink is barely dry on USMCA is just horrible,” Courtney said. He said Canadian aluminum has a price advantage because of cheap hydroelectric power in Quebec, rather than subsidies. “At some point we really to have to kind of step back and look at the value of alliances, and that's a very precious one, right now, given all the other challenges we face.”
The Aluminum Association board, which is made up of 15 CEOs of aluminum companies, including the nation's largest smelter, Alcoa, sent USTR a letter June 25. It said that they hope that the auto rules of origin, which include a requirement to use North American aluminum, will increase demand for Canadian and U.S. aluminum. “It is hard to think of a less opportune time to impose a barrier to rational and fair aluminum trade within North America,” they wrote. In a sentence printed in bold, they said they “strongly oppose any trade actions involving Canadian aluminum.”