For months, manufacturing industry leaders have called for the president to develop explicit trade policies that matched his impassioned campaign rhetoric. They got their wish. The president recently took his first meaningful steps toward establishing a new trade agenda, first signing the ‘Buy American, Hire American’ executive order, and second, launching an investigation into whether foreign steel imports are damaging our national security interests.
President Trump signed the ‘Buy American, Hire American’ executive order from the factory headquarters of Snap-on in Kenosha, Wisconsin, a state in which manufacturing jobs are one of the largest drivers of the economy. The order is a double-barreled approach, requiring the government to actively encourage the use of American-made products and the utilization of ready and willing American labor in tax payer funded projects. Beyond a newfound commitment to strictly enforcing “Buy American” laws, the President also discussed protecting jobs and industries from illegal trade transgressions committed by foreign powers.
All of this comes as a respite for those who have suffered under weak enforcement of trade exploitation and imbalances. Politicians have been paralyzed to confront even the most brazen violations of international trade law. That’s where President Trump’s commitment to launch a Commerce Department investigation as to whether steel imports are effecting national security comes into play.
For years, government-subsidized steel producers in countries like China have illegally dumped low quality steel into the U.S. to flood the market and force American companies out of business. They are cheating in their trade relationship with the United States, jeopardizing both our national and economic security.
Manufacturing industry leaders have long called for bold solutions to better safeguard our jobs and innovations. President Trump promised action and now he’s taking the first steps to combat foreign economic aggression. In his remarks on the new executive order, he specifically mentioned the impact on the steel industry saying, “for the first time ever, we are going to crack down on foreign bidders that used dumped steel and other subsidized goods to take contracts from workers like you. They take them away, and they’ve been doing it for a long time.”
His emphasis on protecting the steel industry is a significant note when considering that in the backdrop of this new executive order, US Steel is in the midst of a bellwether legal battle with Chinese steel producers. U. S. Steel has brought a case before the U.S. government to ban the import of certain types of Chinese steel and set a precedent for others facing the same threat. On April 26, 2016, U. S. Steel filed a complaint with the U.S. International Trade Commission (ITC) to initiate an investigation under Section 337 of the Tariff Act of 1930. The complaint alleges an illegal conspiracy to fix prices and a circumvention of trade duties by false labeling – shipping Chinese steel to the U.S. through third party countries. Nearly a year later, discussions are ongoing.
US Steel’s litigation against China is critical not only to the Steel industry but manufacturing as a whole. American manufacturing can only compete as long as the playing field is level, and quite frankly, it’s nowhere even close to being level. There must be consistent, meaningful enforcement and interpretation of both the letter and spirit of the law, and adherence to widely recognized U.S. trade laws. Useful trade remedy laws are already on the books and U.S. corporations should be applying them. The problem is that they are too often ignored.
President Trump’s ‘Buy American, Hire American’ executive order and the new investigation into steel imports is a sign that the administration not only recognizes that importance of America’s backbone industries, but also will act to ensure that trade laws are fairly interpreted, strictly enforced, and in some cases improved upon. It’s in the United States’ economic and national security interests to ensure that our industries remain viable. At the very least this means enabling basic market forces to determine outcomes. If in some cases that means punishments and tariffs against repeat offender countries, so be it. President Trump will need to continue building on the momentum of these trade policies to produce the lasting change needed to and bring American manufacturing jobs back to America.
Hanna is president of Let Freedom Ring USA Inc., a nonprofit public-policy organization committed to promoting constitutional government, free enterprise and traditional values.