It’s Zero Hour for American Trade Policy

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The Biden Administration and Congress Must Reject Past Trade Mistakes, AAM President Urges in USTR Hearing

Washington, D.C. — The fate of America’s manufacturing rebirth and the livelihoods of millions of American workers depend upon whether the United States truly shifts to a new trade policy that prioritizes U.S. production instead of abandoning it, Alliance for American Manufacturing President Scott Paul told the U.S. Trade Representative on Thursday. 

“At AAM, we have published scores of research that sounded the alarm about supply chain vulnerabilities, as well as the impact of China’s myriad unfair trade practices. Reports from distinguished academics, former military leaders, and cabinet secretaries. None of these warnings were heeded. Again, recent history has shown we were correct,” Paul said.

Despite calls for caution, the U.S. granted China entrance into the World Trade Organization in 2001, and American communities across the country paid the price in the loss of millions of family-sustaining factory jobs. Since then, the U.S. has grappled with Beijing’s persistent trade cheating and the erosion of America’s domestic supply chain. 

“Only a global pandemic and massive supply chain chaos, together with a shift in long-held views across administrations on tariffs and trade enforcement measures, as well as this administration’s industrial policies, have created the space for a new conversation,” Paul said. 

Beijing has nurtured industrial overcapacity for decades in a strategy to eliminate its global competition and secure other nation’s dependence upon its industries. In recent months, skyrocketing Chinese auto overcapacity has engendered an extinction-level threat to U.S. automakers, AAM found in a recent report. Several other critical U.S. sectors, including solar, glass and steel, are also targets in the Chinese government’s mission to cripple America’s manufacturing base. 

To effectively combat China and other countries’ ever-evolving efforts to evade trade rules, America must modernize its tools, proactively initiate trade investigations, and prioritize America’s workers.

“Producers across supply chains respond to policies set by Congress and the administration,” Paul said. “Where strong trade and investment measures are in place, supply chains will be stronger. Moving forward, it is important to monitor for circumvention and evasion of these measures.”

AAM recommended the Biden administration and Congress consider the following policies, among others:

  • Pass the Leveling the Playing Field 2.0 to address “country hopping” tactics
  • Reform de minimis rules, which are routinely exploited to evade trade enforcement and Customs inspections 
  • Sustain Section 232 tariffs on steel and aluminum to ensure the strength of these industries, which are critical to national security
  • Continue Section 301 tariffs on Chinese imports, and, in some cases, strengthening them 
  • Suspend or revoke Permanent Normal Trade Relations for China, as recommended by the bipartisan U.S.-China Economic and Security Review Commission 
  • Thoroughly investigate China’s shipbuilding and its impacts on U.S. industry in the USTR’s Section 301 inquiry into the sector 
  • Fully implement and enforce the Uyghur Forced Labor Prevention Act with additional emphasis on metals and auto parts  

Read Paul’s full written comments to the USTR here and AAM’s report on Chinese auto excess capacity here

Alliance for American Manufacturing President Scott Paul is available for interview.