Biden is seeking higher tariffs on Chinese steel as he courts union voters
SCRANTON, Pa.– President Joe Biden is calling for a tripling of tariffs on steel from China to protect U.S. producers from a flood of cheap imports, an announcement he planned to roll out in a speech to steelworkers in the battleground state of Pennsylvania on Wednesday.
The move reflects the intersection between Biden’s international trade policies and his efforts to court voters in a state that will likely play a crucial role in determining the November election.
The White House insists, however, that it is more about protecting American manufacturing from unfair trade practices abroad than about inflaming a unionist public.
In addition to raising steel tariffs, Biden will also seek to triple tariffs on Chinese aluminum. The current rate is 7.5% for both metals. The administration also pledged to launch anti-dumping investigations against countries and importers that try to saturate existing markets with Chinese steel, and said it is working with Mexico to ensure that Chinese companies cannot avoid tariffs by shipping steel there for subsequent exports to China. The United States
“The president understands that we need to invest in American manufacturing. But we must also protect those investments and those workers from unfair exports linked to China’s industrial overcapacity,” White House national economic adviser Lael Brainard said on a call with reporters.
Biden was expected to announce during a visit to the United Steelworkers union headquarters in Pittsburgh that he is asking the U.S. Trade Representative to consider tripling tariffs. The president is in the middle of a three-day Pennsylvania swing that began Tuesday in Scranton and will include a visit to Philadelphia on Thursday.
The government says China is distorting markets and eroding competition by unfairly flooding the market with below-market steel.
“China’s policy-driven overcapacity poses a serious risk to the future of the U.S. steel and aluminum industries,” Brainard said. Referring to China’s economic downturn, she added that Beijing “cannot export its path to recovery.”
“China is simply too big to play by its own rules,” Brainard said.
Higher rates could entail major economic risks. Steel and aluminum could become more expensive, potentially raising the cost of cars, building materials and other key goods for American consumers.
Inflation has already dented Biden’s political fortunes, and his turn to protectionism echoes the playbook of his predecessor and opponent in this fall’s election, Donald Trump.
The former president imposed broader tariffs on Chinese goods during his administration and has threatened to increase duties on Chinese goods unless they trade on his preferred terms as he campaigns for a second term. An outside analysis by the consultancy Oxford Economics has suggested that the implementation of the tariffs Trump has proposed could hurt the overall US economy.
Senior Biden administration officials said that, unlike the Trump administration, they were seeking a “strategic and balanced” approach to new tariffs. China produces about half of the world’s steel and already produces far more than the domestic market needs. It sells steel on the global market for less than half what U.S.-produced steel costs, officials said.
Biden’s announcement follows his administration’s efforts to provide up to $6.6 billion so a Taiwanese semiconductor giant can expand the facilities it is already building in Arizona and better ensure the world’s most advanced microchips are produced in the US. That step could be considered working. to better compete with Chinese chip manufacturers.
Treasury Secretary Janet Yellen warned against oversaturating the market with cheap goods during a recent visit to China, saying cheap steel had “decimated industries around the world and in the United States.” The Chinese, in turn, expressed serious concerns about US trade and economic measures restricting China, China’s official news agency said. US Secretary of State Anthony Blinken is also visiting China.
The proposed takeover of Pittsburgh-based US Steel by Japan’s Nippon Steel could also shake up the steel industry. Biden said last month he opposed the move.
“US Steel has been an iconic American steel company for more than a century, and it is critical that it remains a domestically owned and operated American steel company,” Biden said at the time.
At a rally last weekend in Pennsylvania, Trump attacked Biden over Nippon Steel’s efforts to buy US Steel, ignoring the president’s objections to the merger.
“I wouldn’t let that deal go through,” Trump said.
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Weissert reported from Washington. Associated Press writer Josh Bock in Washington contributed to this report.