Blumenauer Says CBP Opposition Won't Kill His China de Minimis Bill

Blumenauer, who spoke at the Center for Strategic and International Studies Feb. 15, described a gradual change in perspective, from about 20 years ago, when his son was a factory manager in Southeast Asia for Nike, and he heard from footwear and apparel companies in his region, to where he is now, when he thinks it was a mistake to give China permanent normal trade relations status. He said he regrets voting to hike the de minimis threshold to $800. He said lawmakers didn't "anticipate that the Chinese would build an entire industry predicated on being able to use this de minimis loophole."

Blumenauer said lowering the threshold to a different dollar amount is not the right approach to improve CBP enforcement. He recalled a visit with CBP officials where one of them told him that a 50-pound box said it was worth $5, so he believes exporters would just lie about their shipments' value.

"Providing a lot of jobs for shipping for Amazon, for Fed-Ex ... while putting American businesses out of business seems to me a very poor bargain," he said.

In an interview with International Trade Today after the Feb. 15 event, Blumenauer said just because CBP doesn't support excluding China from de minimis doesn't necessarily make it harder to get his bill through Congress.

"I don't really understand the depth of their opposition," after several meetings with CBP, he said. "And by cutting their workload, 60% of this billion [annual de minimis] packages ought to give them more running room to be able to deal with what they want to do, in terms of protecting the integrity of the supply chain."

Blumenauer said what CBP is asking for instead -- making advance data reporting mandatory for de minimis shipments -- is a pretty typical "bureaucratic response. I'm not surprised. But I do think their case is very weak."

He said he is going to work with the administration on "amping up the pressure surrounding" this issue. He said he's going to publicize more companies that are saying competition from imports in small packages is hollowing out their businesses, as he did with textile firms at a December hearing (see 2312140046). He noted that Republican attorneys general -- including the son of a Republican congressman -- are complaining that fentanyl and chemicals used to make synthetic opiates are entering through de minimis. "We're going to see more and more people who have a story to tell, that's going to be heard."

"I think the concerns that a number of Republicans have, not only about de minimis practice, but deep concern about China per se, I think these forces can be aligned," he said. "And we can actually get this across the finish line."

Blumenauer said he's going to try to encourage Senate sponsors of a bill to remove China from de minimis eligibility to raise the issue's visibility in that chamber. "I mean, there's a lot of things that compete for people's attention, but this is pretty stark. This is sort of my focus for the next three months."

At the event, CSIS Fellow Bill Reinsch asked Blumenauer if he supports the idea of ending most favored nation status for China.

While Blumenauer said the sections 301 and 232 tariffs "inflicted a lot of costs on American businesses and consumers, and did not seemingly change Chinese behavior," he also said he would consider ending MFN for China. "I think we can do it respectfully, and have an orderly process. I don't think we should go on the warpath, slap tariffs on willy-nilly. There are some of these things we should be dialing back."

In the post-event interview with ITT, Blumenauer elaborated: "I think that there are some that are less critical. In terms of the exception list, I think there are things that could be pulled off without upsetting the apple cart. And it's a signal, in some cases, that would be welcome."

But when asked whether the Office of the U.S. Trade Representative would remove items from the Section 301 target list, he sounded less than convinced. "I think they could," he said, but added that the administration's appetite to act on trade is not high. "The will to plunge in and fight this stuff, in the midst of this chaos" may not be there, he said.

During the event, an attendee asked Blumenauer how Congress is looking at trade with Africa, and he said the Ways and Means Committee has had a number of "very interesting meetings" with representatives of African Growth and Opportunity Act beneficiary countries. "I think there's going to be a significant amount of progress."