The White House is planning to make a major announcement Thursday about whether it will impose new limits on steel and aluminum imports, three people familiar with the event said, following months of speculation about whether President Donald Trump would follow through on trade threats and impose tariffs that could roil global markets.
The details of the announcement were closely held and the situation remained very fluid, the people warned. A decision could still be postponed.
The announcement is connected to a review of steel and aluminum imports that the Commerce Department conducted at Trump’s behest. Commerce Secretary Wilbur Ross has found that large amounts of steel and aluminum imports pose a threat to U.S. national security, a declaration that gives the White House powers to limit imports through tariffs or other means.
Several GOP congressional aides late Wednesday did not know the detail of the White House’s announcement but were bracing themselves for stiff trade restrictions that they have spent months trying to prevent.
Word of the announcement came as the Trump administration on Wednesday warned that it would vigorously defend U.S. national interests against “hostile” powers such as China and Russia, vowing to use “all available tools” to combat unfair practices – a sign that the president may be preparing to erect new trade barriers.
“Countries that refuse to give us reciprocal treatment or who engage in other unfair trading practices will find that we know how to defend our interests,” said the annual report to Congress on the president’s trade agenda.
The report, the first by U.S. Trade Representative Robert Lighthizer, comes as the president also is considering retaliating against China for forcing foreign companies to surrender their intellectual property and is seeking to renegotiate a pair of major trade deals.
“The tone is very different,” said economist Christine McDaniel of George Mason University’s Mercatus Center. “I don’t think we’ve ever seen this aggressive and protectionist a tone before in a trade agenda.”
Philip Levy, senior White House trade economist for President George W. Bush, said the Trump administration “comes off as belligerent” in the document.
The 359-page report was made public as U.S. officials were in Mexico City for the latest round of talks aimed at renegotiating the 1994 North American Free Trade Agreement. Trump has repeatedly threatened to quit NAFTA unless Mexico and Canada agree to concessions that return lost manufacturing jobs to the United States.
The administration took credit for launching “a new era in American trade policy” by reversing decades of multilateral trade policies that it said had damaged U.S. workers and intensifying enforcement efforts. Over the past 13 months, the Commerce Department has initiated 102 anti-dumping and countervailing-duty investigations, nearly double the prior-year figure.
“We have to get more jobs back to America. We have to reduce the deficit, and that will ultimately put pressure on wages and raise wages,” Lighthizer said earlier this week on the Laura Ingraham show, calling it “nonsense” that the administration was preparing to start a trade war with China.
The nearly $20 trillion economy gives the United States leverage to extract better trade terms from other nations and “fairer treatment for American workers,” the report said, echoing a point that Lighthizer has stressed.
The administration assailed China for “undermining true market competition” with state subsidies that encouraged excess production that depressed the price of key goods, including steel.
But McDaniel criticized the administration’s reliance upon tariffs as damaging to U.S. economic growth and ineffective in compelling countries such as China to change its trading practices.
“Other countries are frustrated as well. The only way to rein in China is by working with like-minded countries,” she said.
The president’s desire for wholesale change in U.S. trade policy has met with increasing resistance from congressional Republicans as well as the business community, normally a reliable GOP ally. The report “doesn’t resolve any of the conflicts they have,” Levy said.
Despite the president’s claims of progress, he has little to show for some of his central promises after more than a year in the White House. Though he promised to narrow the yawning U.S. trade deficit, it reached $566 billion last year, a 12.1 percent increase over 2016 and the highest mark in nine years.
The U.S. deficit with China last year hit a record $375 billion, the Commerce Department said last month.
The report was critical of the World Trade Organization, which it said is not functioning properly and thus is “undermining our country’s ability to act in its national interest.”
Lighthizer has been a vocal advocate of change at the WTO, and the report detailed several desired changes, including overhauling its mechanism for resolving disputes between member countries.
“It doesn’t spell out exactly how the United States will pursue these goals, but it is quite a clear and ambitious agenda for reform of the WTO,” said Edward Alden, a trade expert at the Council on Foreign Relations.
The administration reiterated the president’s intention to pursue new trade deals in talks with individual nations rather than large groups. But no countries have yet agreed to enter negotiations, making the claim “empty,” Levy said.
The report also underscored the mixed messages emanating from the administration on trade, particularly on a Pacific trade deal that Trump withdrew the United States from on his first working day in the White House.
On Tuesday, Treasury Secretary Steven Mnuchin said that he had engaged in “high-level” discussions with foreign counterparts aimed at enabling the United State to rejoin the treaty with Japan and 10 other nations. Trump in January said for the first time that he might seek to reenter the trade pact that he earlier had disparaged.
The U.S. trade representative’s report, however, quoted Trump’s campaign statements that there “is no way to ‘fix’ the TPP” and that “we do not need to enter into another massive international agreement that ties us up and binds us down.”
