WASHINGTON -- President Donald Trump defied opposition from his own party and protests from overseas Thursday, and signed orders imposing new tariffs on imported steel and aluminum. However, he sought to soften the impact on the United States' closest allies with a more flexible plan than originally envisioned.
After a week of intense lobbying and a burst of last-minute internal debates and confusion, Trump agreed to exempt, for now, Canada and Mexico, and held out the possibility of later excluding allies such as Australia. But foreign leaders warned of a trade war that could escalate to other industries and be aimed at U.S. goods.
"The actions we are taking today are not a matter of choice; they are a matter of necessity for our security," Trump said in a ceremony at the White House where he officially authorized the tariffs, which will go into effect in 15 days.
Flanked by a handful of steel and aluminum workers, some wearing coveralls and holding hard hats, Trump presented his move as a way to rebuild vital industries decimated by foreign competition. "Our factories were left to rot and to rust all over the place; thriving communities turned into ghost towns," he said. "The workers who poured their souls into building this great nation were betrayed. But that betrayal is now over."
The orders represented Trump's most expansive use of federal power to rewrite the rules of global trade since he took office and upended the prevailing consensus on free markets that has largely governed Washington under administrations of both parties for decades. A longtime critic of globalization, Trump argued that the United States has been ravaged by unfair trading partnerships.
As a result of Trump's action, levies on foreign steel will rise by 25 percent and on imported aluminum by 10 percent. Business groups have warned that the impact could be felt across the supply chain as consumers face higher prices for automobiles, appliances and other goods. But Trump's aides dismissed such predictions as "fake news" and said most Americans will hardly notice any impact.
The United States is the largest steel importer in the world, and the order could hit South Korea, China, Japan, Germany, Turkey and Brazil the hardest. Trump said his tariff orders were tailored to give him the authority to raise or lower levies on a country-by-country basis and to add or take countries off the list as he deems appropriate.
The potential for an exemption is likely to trigger a tsunami of lobbying and cajoling as foreign governments pressure the White House for a carve-out. The United States imports steel from Japan, Germany, Brazil, South Korea and other nations.
In language authorizing the tariffs, the White House said any nation "with which we have a security relationship is welcome to discuss with the United States alternative ways to address the threatened impairment of the national security caused by imports from that country."
The tariffs would be lifted if a country arrives "at a satisfactory alternative means to address the threat," the order said.
Canada and Mexico would be exempt pending discussions with both countries about changes that would address Trump's concerns about steel and aluminum, and no time limit was imposed on the exclusion, although administration officials said they expect to deal with those two countries in short order.
Trump tied the exclusions to renegotiation of the North American Free Trade Agreement, which remains bogged down in inconclusive talks, but aides said national-security concerns would be important in deciding whether to make the exclusions permanent.
Trump indicated that the tariffs would go into effect on Canada and Mexico "if we don't make the deal on NAFTA and if we terminate NAFTA because they are unable to make a deal that's fair."
Trump cited the "unique nature of our relationship with Canada and Mexico" in excluding the countries. The tariffs are being applied on the grounds of national security, which the president said was a "very important aspect" of NAFTA, which came into force in 1994.
If no deal is reached in negotiations among the three countries, which began in August, "then we're going to terminate NAFTA and we'll start all over again or we'll just do it a different way," Trump added.
During a Cabinet meeting earlier in the day, Trump singled out Australia as an example of another country that could be excluded from the higher tariffs, citing the trade surplus that the United States maintains with Australia, which imports more from the United States than it exports to the country.
Mario Draghi, the president of the European Central Bank, said Thursday that a plan to impose broad tariffs that hit allies is "dangerous" and could undermine national security.
"If you put tariffs against your allies," Draghi said at a news conference in Frankfurt, Germany, "one wonders who the enemies are."
Stephen Sandherr, chief executive of Associated General Contractors of America, said the tariffs would "cause significant harm to the nation's construction industry, put tens of thousands of high-paying construction jobs at risk, undermine the president's proposed infrastructure initiative and potentially dampen demand for new construction projects for years to come. That is because the newly imposed tariffs will lead to increases in what construction companies are forced to pay for the many steel and aluminum products that go into a typical construction project.
"Firms that are already engaged in fixed-price contracts may be forced to absorb these costs, forcing them to cut back on new investments in equipment and personnel," he said.
The president's comments came after a frenzied and uncertain morning in which administration officials tried to resolve debates and complications that threatened to hold up the order he has been trumpeting for a week.
More than 100 Republican lawmakers sent a letter to Trump on Wednesday imploring him to drop plans for raising the tariffs. Their letter came a day after Trump's chief economic adviser, Gary Cohn, announced his resignation after his failure to forestall the president from pursuing higher tariffs.
House Speaker Paul Ryan, appearing at a session with Home Depot employees in Atlanta, said ahead of Trump's announcement, "I'm just not a fan of broad-based, across-the-board tariffs." He pointed to the store's many products that rely on steel and aluminum.
Arizona Sen. Jeff Flake, a Republican, said he plans to introduce legislation next week to nullify the tariffs though he has acknowledged that finding the votes to stop the president's actions could be difficult.
Sen. Ron Johnson, R-Wis., who represents a Midwestern industrial state that was key to Trump's Electoral College victory in 2016, said a broad tariff plan will be self-destructive.
"If it's targeted toward China, depending on how it's tailored, I may not have a problem with it, because that's where the root cause of the problem is, the gross oversupply within China," Johnson said Thursday on CNN. "But a generalized tariff that would actually harm allies, harm American consumers, by the way, harm American workers that use steel in production, hurting their competitive nature in global markets as well, I'm opposed to that."
White House Chief of Staff John Kelly (left), Ivanka Trump and her husband White House senior adviser Jared Kushner stand during a Cabinet meeting Thursday before President Donald Trump signed orders setting new tariffs on foreign steel and aluminum imports.
There was some bipartisan concurrence on the idea of focusing any tariff plan on China rather than more broadly. "President Trump has identified the right opponent -- China -- much better than both the Obama and Bush administrations did," Sen. Charles Schumer, D-N.Y., the minority leader, said on the floor.
"But I would say to you, Mr. President, don't swing blindly and wildly at our foe, China," he added. "Establish a well-placed jab at China. Set them back. Let them know we mean business. President Trump ought to rethink his plan so it actually achieves what he says he wants it to achieve."
Information for this article was contributed by Josh Wingrove of Bloomberg News and Ken Thomas of The Associated Press.
A Section on 03/09/2018
Print Headline: Trump goes ahead on tariffs; Exemptions allowed for 2 neighbors, maybe more