At a House Ways and Means Committee field hearing, witnesses offer a number of ideas for strengthening manufacturing by enforcing our trade laws.
Members of Congress headed to a container ship terminal in Staten Island on Tuesday — “the birthplace of Pete Davidson,” as hometown Rep. Nicole Malliotakis (R-N.Y.) described it — for a special field hearing to examine how trade is impacting American workers and supply chains.
And witnesses from different backgrounds offered a consistent message: The United States must do more to enforce its trade laws.
United Steelworkers Local Union 135L President Thomas O’Shei recounted how his union repeatedly has pursued trade cases to protect American jobs, only to have to keep fighting because foreign companies find ways to evade enforcement. John Romano, CEO of titanium company Tronox, talked about how “Section 301” tariffs on China helped level the playing field for his industry — and how weakening that enforcement tool could damage the progress that has been made.
And Uyghur American Nury Turkel, chairman of the United States Commission on International Religious Freedom, argued that the United States needs to get more aggressive to enforce key laws like the Uyghur Forced Labor Prevention Act (UFLPA), which aims to stop products made with forced labor in China from reaching U.S. shores.
Indeed, addressing China seemed to be a common theme of the field hearing, with witnesses outlining to the panel the many ways American workers and companies have suffered due to the Chinese government’s litany of predatory trade practices.
“What we are dealing here is a regime that enslaves its own population, that subsidizes key industries, making it impossible for American companies to compete fairly, and also steals our technology,” Turkel said.
China’s use of Uyghur forced labor to manufacture products, including for Western brands, “is not going to disappear or even be minimalized” on its own, Turkel said. It’s vital that the United States do more to stop goods made with Uyghur forced labor from entering the United States.
Indeed, dozens of Western companies have been accused of benefiting from Uyghur forced labor. Just last week, Reps. Mike Gallagher (R-Wis.) and Raja Krishnamoorthi (D-Ill.), the chairman and ranking member of the Select Committee on the Chinese Communist Party (CCP), sent letters to Nike and Adidas seeking answers on their ties to forced labor in the Xinjiang region.
The United States cannot expect corporations to change their practices out of the goodness of their heart. Robust Congressional oversight of the UFLPA and increased funding to enforce the bill is the first step toward enacting change, Turkel said. And additional policy is needed, including new legislation to amend the Foreign Corrupt Practices act to address corporate complicity in forced labor and human trafficking, Turkel said.
“American consumers are increasingly aware that our proclaimed national values are not aligning with U.S. corporate interests abroad,” Turkel said. “Ignoring modern-day slavery is morally unacceptable. It compromises the soul of our nation.”
A loophole in U.S. trade law is also undermining enforcement of the UFLPA, said Rep. Earl Blumenauer (D-Ore.). The de minimis rule allows imports valued less than $800 to enter the country duty-free, and Chinese companies like SHEIN and Temu have exploited it to dodge tariffs.
It’s not just trendy fast fashion brands using de minimis to their advantage. O’Shei said foreign tire makers have shipped packages of four tires into the United States, priced strategically under $800, so de minimis would apply.
“We’re here in New York, the home of exploding electric bike batteries, there are $799 e-bikes coming through under this loophole,” Blumenauer said.
Along with using de minimis to dodge duties, the loophole also often allows these companies to evade the UFLPA. Turkel noted that between 2 million and 3 million de minimis packages each day come through the United States. When U.S. Customs inspectors examined just a portion of them at John F. Kennedy International Airport, about 25% of the packages were found to have some kind of violation.
It’s time to close the de minimis loophole, the witnesses agreed. “They found every loophole they could to get around our trade laws and our trade cases,” O’Shei noted.
There are other policy avenues that Members of Congress should pursue to level the playing field for American workers, witnesses said. For example, global companies are increasingly shifting production from one country to another to dodge enforcement efforts, O’Shei noted. Legislation like Level the Playing Field Act 2.0, introduced last Congress and expected to be reintroduced this session, would provide officials with the modern trade tools they need to take on these practices, O’Shei said.
Romano told the committee that Section 301 action had allowed his company to invest in its American operations, including a plant in Mississippi. But he warned that China is working hard to dominate the worldwide titanium market by creating global overcapacity — a tactic other American industries know all too well — and said increasing 301 enforcement may be needed to counter China’s aggression.
O’Shei also recommended Congress reauthorize Trade Adjustment Assistance (TAA) to provide job training support for U.S. workers laid off due to trade; increase penalties for companies that violate U.S. Customs laws; and strengthen rule of origin standards to ensure that non-partner countries do not gain duty-free market access.
O’Shei, who has worked at a Buffalo tire plant for about 35 years, said his factory survived the onslaught of unfairly dumped imports over the past several decades only because the United Steelworkers “used every tool available” to protect U.S. factory jobs like his.
“I can sit before you today talking about expansion, and tell you I recently posted on my Facebook page about job openings at the plant that start at $25.33 an hour with excellent benefits, not just because of our union contract, but also because the United Steelworkers fought against illegally dumped and subsidized imports,” O’Shei said.