Blanket tariff proposal could jeopardize recent economic boom

Since President Trump took office, he and Congress have worked together to strengthen our economy, protect American workers, and put our country on a stronger path.

Thanks to his leadership, we passed historic tax cuts and rolled back the Obama administration’s most burdensome regulations. Now our economy is growing, businesses are expanding, workers are seeing more money in their paychecks, and America is back ahead of our global competitors.

{mosads}However, the president’s recent proposal to impose blanket tariffs on aluminum and steel imports threatens to undercut this economic boom and cost good-paying American jobs.

President Trump is right to take action against unfairly traded aluminum and steel from countries like China, but across-the-board tariffs will harm American manufacturers, workers and consumers while letting China off the hook.

The district I represent in Congress is the perfect illustration of how the proposed tariffs of 25 percent on steel and 10 percent on aluminum would put our economic recovery at risk. In Indiana’s 2nd District, 23.1 percent of our jobs are manufacturing jobs – the second-highest percentage in the country. The Great Recession hit our communities hard, but now business is booming and Hoosiers are thriving. In Elkhart County, for instance, the unemployment rate is down to 2.1 percent.

Our economy is largely driven by RV, trailer, boat and other heavy manufacturers and their suppliers. I’m hearing from these employers that their aluminum and steel costs have gone up simply because of the threat of tariffs, and it will only get worse if they take effect.

As a result, one manufacturer is already putting the brakes on a planned expansion that was going to be paid for with savings from tax reform.

Another business that was planning to give bonuses to its employees is now considering putting that plan on hold.

And yet another manufacturer told me he will be forced to either raise prices – potentially losing business to competitors in Mexico and China – or “begin laying off employees just to survive.”

In two recent face-to-face meetings at the White House and in a letter I sent to the president, I shared the concerns of these Hoosier manufacturers and outlined four key concerns with his plan.

First, based on what I’m hearing from back home, I’m concerned immediate, blanket tariffs could slow our economy and reverse the return of manufacturing jobs to northern Indiana.

Second, this proposal could ignite a trade war, not just with our rivals but with allies and trading partners like Canada, Mexico, and the European Union. Retaliatory tariffs targeting American agricultural goods and made-in-America products could devastate the family farmers, small business owners, and manufacturers that form the backbone of our economy.

Third, these broad tariffs would disrupt ongoing negotiations to strengthen the North American Free Trade Agreement (NAFTA) and the U.S.-Korea Free Trade Agreement (KORUS). I share the president’s goals of modernizing NAFTA for the 21st century, improving certain provisions in KORUS, and opening up new markets for American exports, but tariffs on these countries could stall talks and would only weaken our country’s negotiating position.

Finally, blanket tariffs could harm our national security by weakening America’s alliances and raising the cost of U.S. military equipment. Secretary of Defense James Mattis has warned against imposing broad tariffs on our most trusted allies amid growing global security threats.

These risks are not worth taking for a plan that would not solve the real problem, which is overcapacity, dumping, and transshipment of aluminum and steel by countries like China.

Even the domestic producers the tariffs are meant to help think blanket tariffs will let China off the hook. The Aluminum Association said the proposal “may do more harm than good.” The president of the United Steelworkers called it “a gift” to China.

Raising costs for American manufacturers and starting a trade war with our allies won’t stop China from cheating. And hurting American manufacturers and putting farmers at risk won’t save American jobs. Instead, we need a narrowly targeted solution.

That’s why I’m calling on the president to ensure any tariffs are tailored to address unfair trade practices and exempt fairly traded products, and to allow U.S. businesses duty-free access to products they cannot obtain from domestic suppliers.

President Trump has spent his time in office leading the charge to restore American competitiveness, bring back jobs, and keep the American Dream alive. The results of tax cuts and regulatory reform have been swift and overwhelmingly positive for American workers, businesses, and families. Let’s keep that momentum going.

President Trump should find a fair, balanced, and effective solution that builds on his pro-growth agenda, supports our manufacturers, and protects American workers.

Jackie Walorski represents the 2nd District of Indiana, serving as a member of the House Ways and Means Committee.