TAI FACES CONGRESS THIS WEEK: In one indication of what to expect at this week’s trade policy hearings, Rep. Carol Miller (R-W.Va.) and a number of other Ways and Means Republicans sent U.S. Trade Representative Katherine Tai a letter criticizing USTR’s decision to scale back references to digital trade in the agency’s recent annual report on foreign trade barriers. “Ultimately, a weaker stance on digital trade in this year’s [report] is a signal that USTR will no longer resist new foreign digital trade barriers, an even more expansive position than the current digital trade abdication,” the lawmakers wrote. Engine, a tech policy and advocacy group, also pressed committee leaders to examine Tai’s digital trade moves and “implore her to change course.” Tariff review: This week’s back-to-back hearings also provide an opportunity for lawmakers to quiz Tai on a number of other topics, including her agency’s nearly two-year-old review into whether to remove or increase any of the tariffs that former President Donald Trump imposed on more than $300 billion worth of Chinese goods. Shipbuilding probe: She could also face questions about a request from the United Steelworkers and other unions for USTR to launch an investigation that could lead to a $1 million port fee on Chinese-made ships that deliver goods to and from the United States. Nippon Steel: Tai sits on the interagency Committee on Foreign Investment in the United States, raising the possibility she could be asked whether Nippon Steel’s proposal to buy U.S. Steel poses any national security threat to the United States. U.S. Steel shareholders voted overwhelmingly on Friday to approve the proposed deal, which is still subject to review by CFIUS and the Justice Department. Electric vehicles: Lawmakers could also press Tai to discuss her view on Chinese-made electric vehicles, which already face a 27.5 percent U.S. tariff due largely to actions taken by Trump when he was in office. Last week, Finance member Sherrod Brown (D-Ohio) called for a complete ban on Chinese vehicle imports. LEFTY ECONOMISTS SAY DITCH ISDS: More than 300 progressive professors and economic scholars — including Nobel Prize winner Joseph Stiglitz and Harvard Law School professor emeritus Laurence Tribe — are sending a letter to the Biden administration today urging it to remove investor-state dispute settlement provisions from existing trade agreements. ISDS, which allows companies to bypass local laws and adjudicate disputes with foreign governments through special private sector tribunals, has long been a target of trade reformers on the left. It was largely removed from the U.S.-Mexico-Canada agreement that updated NAFTA, and the scholars say the Biden administration should follow up by carving it out of other agreements, as well. ISDS “has enabled large multinational corporations to undermine countries’ ability to address climate change and other urgent challenges, forced them into costly litigation, and unjustly enriched corporate coffers at the expense of the wellbeing of countries,” Stiglitz said in a release sent with the letter. “President Biden is right to oppose expansion of ISDS and must now take action to end this system.” The correspondence comes after dozens of progressive lawmakers, led by Sen. Elizabeth Warren and Rep. Lloyd Doggett, sent a similar letter to Biden urging the elimination of ISDS in U.S. agreements. TRUMP EYES WAYS TO WEAKEN DOLLAR: The trade dimension of this year’s presidential election could go way beyond tariffs. Economic advisers close to former President Donald Trump are actively debating ways to devalue the U.S. dollar if he’s elected to a second term. That’s a dramatic move that could boost U.S. exports but also reignite inflation and threaten the dollar’s position as the world’s dominant currency. Gavin Bade has more here. SAMSUNG AWARDED CHIPS GRANT: The Biden administration today plans to give Samsung a $6.4 billion grant from the CHIPS and Science Act to establish a hub of semiconductor manufacturing and research in central Texas. If finalized, the award will enable the South Korean tech giant to drastically expand its U.S. foundry business, making logic chips for outside customers. Our tech colleague Christine Mui has more here. THREE-LEGGED STOOL: Scott Paul, president of the Alliance of American Manufacturing, urged lawmakers to adhere to what he called the “three-legged stool” of U.S. trade policy: the expansion of exports, enforcement of trade laws and agreements, and assistance for workers who have lost their jobs because of foreign competition. “Regrettably, Congress has all too often neglected enforcement and adjustment as it has sought to expand foreign market access and facilitate imports. As your committees proceed with consideration of trade policy measures, we strongly urge that you fully address trade cheating and provide assistance to workers who have involuntarily lost their jobs due to foreign competition,” Paul wrote in a letter to the committee leaders. The group’s China-heavy wish list includes: — Suspending or revoking “permanent normal trade relations” for China — Modernizing U.S. trade enforcement laws “to keep up with new and evolving tactics” used by China and other countries to circumvent anti-dumping and countervailing duties — Excluding goods from China and other non-market economies from the “de minimis” provision that allows shipments worth less than $800 to enter the U.S. duty-free — Preventing a possible surge of Chinese electric vehicles into the U.S. — Reforming the expired Generalized System of Preferences program by increasing the domestic content requirement for imported goods to qualify for U.S. duty-free treatment — Reauthorizing the federal Trade Adjustment Assistance program to help workers who have lost their jobs because of foreign competition HOUSE DEMS CALL FOR CHINA SHIPBUILDING PROBE: Tai has until April 26 to announce her decision on the Section 301 shipbuilding petition filed last month by union groups. Late last week, a group of more than 30 House Democrats led by Rep. Joe Courtney (D-Conn.) sent her a letter outlining why they think she should launch a probe. “In the last 22 years, the PRC has led a campaign of subsidization, strategic targeted investment, and other related policies with the aim of dominating global shipping and advancing the goals of the Chinese Communist Party,” the lawmakers wrote. “This effort to dominate global shipping has resulted in the PRC’s shipbuilding industry increasing from less than 10 percent of global shipbuilding capacity to nearly 50 percent in the year 2024.” Subsidy fund: The union groups want the administration to use the money collected from the proposed port fee to create a “Shipbuilding Revitalization Fund” to support investments in the domestic shipbuilding industry’s capacity, supply chains and workforce. Elizabeth Drake, an attorney working with the unions, told Morning Trade they believe Biden has authority under Section 301 to designate how any money raised from the port fee would be spent, even though others think Congress would have to decide. The federal government has collected more than $210 billion from the tariffs that Trump imposed on Chinese goods using Section 301, and those funds simply have gone into the general treasury without being earmarked for any particular use. SMITH’S TRIP TO AFRICA STIRS AGOA HOPES: House Ways and Means Chair Jason Smith’s (R-Mo.) recent (and somewhat stealthy) visit to Africa is raising hopes for action this year on renewal of the African Growth and Opportunity Act. Unlike a trip that Smith led last year to Mexico, Ecuador and Guyana, the Republican Ways and Means press office did not publicize his stops in Benin, Mauritius and Madagascar. However, U.S. embassies at each of those locations issued press releases after the visits. Smith’s trip came after he or any other U.S. lawmaker failed to make the trip to South Africa in early November for the annual AGOA forum. However, Smith and Ways and Means ranking member Richard Neal (D-Mass.) did hold a roundtable in January to discuss how to best reform the AGOA trade preference program, which expires in September 2025. “The next step is a hearing,” hopefully before the August recess, since Smith has indicated his intention to follow regular order in crafting AGOA legislation, Beth Hughes, vice president for trade & customs policy at the American Apparel & Footwear Association, told Morning Trade. After that, Smith will hopefully push legislation, she added. Haiti bills: Hughes also urged Congress to renew two trade preference programs for Haiti, known by the acronyms HELP and HOPE, that also expire in September 2025. That would help ensure continued apparel industry investment in the Caribbean nation, which is reeling from years of political unrest and gang violence, she said. It would also support more than 50,000 formal Haitian jobs in the apparel sector and tens of thousands of Haitians who benefit from the employment provided by companies like Gap and Hanes. Pink tariffs: In another area, Hughes welcomed the “Pink Tariffs Study Act” introduced last week by Rep. Lizzie Fletcher (D-Texas) and Brittany Pettersen (D-Colo.) It requests the Treasury Department to examine whether the current tariff structure taxes products used by women more than products used by men, and whether low-income families have a higher tariff burden than high-income families. “For years, women have been paying more at the register for things like clothes, shoes, and razors, Rep. Lois Frankel (D-Fla.), chair of the Democratic Women’s Caucus, said in a statement. “This is just plain wrong, and this bill will help us root out unfair tariffs aimed at goods marketed to women.” A 2018 “working paper” by staff at the International Trade Commission already points to gender bias in the U.S. tariff system. First, it found average tariff rates on women-specific products were higher than the average tariff rates on men’s goods. “Second, U.S. consumers spend twice as much money on women’s clothing than on men’s clothing and the vast majority of this clothing is imported,” the ITC staff found. “The combination of higher tariff rates and greater spending on imported goods means that women carry a significantly higher share of total tariff burden compared to men.”
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