Bolten to Senate Committee: Congress Should Assert Its Authority on Trade
Business Roundtable President & CEO Joshua Bolten testified before the Senate Foreign Relations Committee in a recent hearing on “Tariffs: Implications for U.S. Foreign Policy and the International Economy.” Bolten explained Business Roundtable’s opposition to the Administration’s Section 232 steel and aluminum tariffs and called on Congress to take action to prevent the misuse of the statute to inappropriately restrict trade.
“The Administration’s deployment and threatened deployment of Section 232 tariffs demonstrates clearly that the statute is susceptible to misuse,” Bolten said in his opening remarks. “It is time for Congress to assert its constitutional prerogative to prevent serious harm to the US economy.”
In his testimony, Bolten outlined four key reasons the Roundtable opposes the Administration’s 232 tariffs on steel and aluminum — sentiments that were echoed throughout the hearing by Senators on both sides of the aisle:
1. Increased Cost to Consumers
Bolten: “This multibillion dollar tax increase on imported steel and aluminum is already driving up the cost of many industrial and consumer products.”
Senator Chris Coons (D-DE): “The President has launched a trade war without a strategy, and these Trump tariffs are imposing consumer taxes. I’m hearing from folks in Delaware. From port workers at the docks, who are concerned that shiploads of steel that come to my state in the winter time from Sweden and Finland will not be coming. That the costs will be raised. That their jobs will be harmed.”
2. Makes American Businesses Less Competitive
Bolten: “[B]y driving up the cost of inputs, these tariffs are also causing US-made final products to be less competitive in both domestic and export markets.”
Senator Jeff Flake (R-AZ): “This will lead to a weakened economy, and we’re seeing the knock-on effects now with the announcements of companies moving offshore now to escape these tariffs.”
Senator Tom Udall (D-NM): “Companies will be forced out of business, and they will be required to pay a new tariff every step of the way. You’re going to put companies out of business in New Mexico with these tariffs.”
3. Invites Retaliation Against U.S. Companies and Exporters
Bolten: “[T]he 232 tariffs are inviting a cascade of retaliatory tariffs against America’s most competitive exports.”
Senator Tim Kaine (D-VA): “Catoctin Creek Rye Whiskey — this is a small little distillery in Purcellville, Virginia. They are small — they employ [20] people. In the last five years, they’ve spent $100,000 to expand in Europe. In Europe, American whiskey is really popular. This tiny company… has had some real significant success in starting to sell Catoctin Creek in Germany, Italy, Holland, and the UK. But, after the steel and aluminum tariffs went into effect, the EU retaliated with equivalent tariffs on whiskey — an additional 25% tariff. The founder of the company, Scott Harris said, ‘We’re just launching into the European market now in a big way, and this is the worst possible timing for us. We’re probably going to see all of our European sales come to a screeching halt.’”
4. Misuse of 232
Bolten: “The Administration’s improper use of Section 232 — twisting the definition of ‘national security’ beyond reason — invites other countries to do the same against a wide range of US exports.”
Senator Rob Portman (R-OH): “I think there are things we could do moving forward to make sure that we do not misuse 232 because, my concern is we will lose the tool. We will lose it because one of two things will happen: Either other countries will respond in kind as we’re starting to see… or we’ll go back to the WTO as we have been in the past. And this time we will find ourselves losing an Article 21 case with regard to 232 because of the way we’ve used it so broadly.”
Video of the full Senate Foreign Relations Committee hearing can be found here. To read Joshua Bolten’s written testimony, please click here.