House Speaker Ryan Breaks With Trump Over Steel Tariffs--Update
By Siobhan Hughes
WASHINGTON -- House Speaker Paul Ryan broke with President Donald Trump over his decision to impose tariffs on imported aluminum and steel products, setting the stage for a high-profile policy fight between Republican leaders and the White House.
Mr. Ryan's concerns match those of many Republican and Democratic lawmakers, who fear the proposed trade measures will short-circuit the U.S. economic expansion while also punishing allies.
"We are extremely worried about the consequences of a trade war and are urging the White House to not advance with this plan," said AshLee Strong, a spokeswoman for the Republican from Wisconsin. "The new tax reform law has boosted the economy and we certainly don't want to jeopardize those gains."
Mr. Trump on Monday afternoon insisted that "we're not backing down." Earlier in the day, Mr. Trump linked the tariffs to negotiations with Mexico and Canada on revising the North American Free Trade Agreement. He said in a morning tweet: "Tariffs on Steel and Aluminum will only come off if new & fair Nafta agreement is signed."
Congressional Republican leaders aren't ruling out potential legislative action aimed at blocking such tariffs, according to a Republican familiar with the matter.
"I think there are some things we could do," said Senate Finance Committee Chairman Orrin Hatch (R., Utah). He declined to provide details. Referring to Mr. Trump's threat on tariffs, he said: "I think he's shooting one across the bow and letting people know that we're not being treated fairly," said Mr. Hatch. But, he said, "that would be a real mistake... and we'd pay a big price."
Sen. John Cornyn (R., Texas) said Congress could consider legislative action, but more study was needed. "Clearly the president is listening to some people who have ideas about trade that many of us don't share," Mr. Cornyn said.
House Ways and Means Committee Chairman Kevin Brady (R., Texas) urged Mr. Trump to at least exempt some countries from the aluminum and steel sanctions. "We think tailoring the tariffs strengthens the president's hand," he said.
Joshua Huder, a senior fellow at Georgetown's Government Affairs Institute, said lawmakers have several options to try to block new tariffs. For example, they could include a rider in the coming must-pass spending bill prohibiting the president from adjusting tariffs or altering Nafta, he said.
Any such legislative action would take the relationship between the GOP-led Congress and the Republican president into new waters. Until Monday, Republican leaders had remained united with the president on most of his main policy goals. Disagreements have emerged over issues such as immigration and gun control, but GOP leaders have avoided directly challenging the president.
The reaction to tariffs has been different, however. Many lawmakers see the tariffs -- and possible retaliation against U.S. industries -- as having the potential to upend the economic growth that Republicans want to harness heading into the midterm elections. Moreover, unlike on gun or immigration policy, the president has the power to impose these trade sanctions unilaterally without congressional approval.
The top Republicans overseeing trade policy are circulating a letter warning that tariffs are a bad idea, which will be delivered to Mr. Trump. Mr. Brady and Rep. Dave Reichert (R., Wash.), who oversees a subcommittee focused on trade, have already drafted the letter and are seeking signatures, a spokesman for the Republicans on the panel said.
The letter expresses "concerns about the prospect of broad, global tariffs on aluminum and steel imports," said the committee spokeswoman, Lauren Aronson. "Any tariffs should be narrow, targeted and focused on addressing unfairly traded products without disrupting the flow of fairly traded products for American businesses and consumers," she said.
In another development, Sen. Mike Lee (R., Utah) is now calling on Congress to re-engage in the tariff process, promoting a bill he introduced in Congress last year that removes the power from the White House to impose tariffs unilaterally.
Mr. Trump wants to protect the steel industry from what he sees as unfair competition from trading partners and especially from China. His plan to impose tariffs of 25% on steel imports and 10% on aluminum imports is set to benefit domestic U.S. producers. At the same time, he is negotiating with Canada and Mexico for better terms on Nafta, and has now publicly linked the two issues.
The tariffs' move will also boost the cost of metals for a host of industries such as automobiles and construction equipment that use steel and aluminum. That worries Republican lawmakers who are supportive of the broader business community and wary of taxes and tariffs.
Rep. Mark Meadows (R., N.C.), while opposed to the announced tariffs, said he sees the president's decision to tie the tariffs to the Nafta negotiations as possibly helpful in trade negotiations.
"If it provides the stimulus to reach agreements without completely abandoning the Nafta agreement that would be a real silver lining," he said.
Write to Siobhan Hughes at firstname.lastname@example.org
(END) Dow Jones Newswires
March 05, 2018 18:06 ET (23:06 GMT)Copyright (c) 2018 Dow Jones & Company, Inc.