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Mnuchin Defends Trump Tariffs as World Economic Leaders Worry

March 20,2018 13:10

BUENOS AIRES — President Trump's plan to hit countries around the world with stiff tariffs on imports of steel and aluminum has dominated a gathering of world economic leaders amid fears that the United States is on the cusp of starting an ...and more »

Trump administration officials have said that the tariffs are aimed primarily at combating cheap metals from China, which they say are flooding into the United States through other countries. The Commerce Department has ruled that those imports pose a threat to national security because they degrade the United States industrial base.
Countries including France, Argentina and South Korea pressed Mr. Mnuchin on Monday about being freed from the metals tariffs, arguing that, as United States allies, they should not be penalized on national security grounds. Mr. Mnuchin said that decisions were being made on a case-by-case basis and that there was not a one-size-fits-all approach to deciding which countries would be exempt. The tariffs go into effect on Friday.
Mr. Mnuchin said he was confident that the United States was acting in compliance with the World Trade Organization, and argued that the Trump administration was not trying to start a trade war.
“I think we have the right combination here of doing something to protect U.S. industry from dumping and unfair competition in the appropriate way,” he said. “The objective is not to put tariffs on everybody but to solve the issue.”
But many are fearful that steel and aluminum tariffs are just the beginning of a broader effort to erect trade barriers that could upend a globally integrated economy.
The Trump administration is expected to announce at least $30 billion in new tariffs on China this week, and tensions between the two economic superpowers are on the rise. David Malpass, Treasury’s under secretary for international affairs, said at a forum here on Sunday that China was reversing decades of progress in liberalizing its economy and that formal economic discussions between the two countries, known as the Comprehensive Economic Dialogue, had stalled as a result.
Mr. Mnuchin declined to comment on the coming China tariffs but said he made his concerns about the United States’ access to the Asian nation’s market known to his Chinese counterpart at the G-20.
“We’re having very direct discussions with China about reciprocal trade, discussed this morning about market reforms in China,” Mr. Mnuchin said. “We look forward to them hopefully moving in that fashion.”
While Mr. Mnuchin said that other countries had started to adapt to the United States’ new trade policy, it was evident in Argentina that anxiety levels were high.
Bruno Le Maire, France’s finance minister, said Monday that he told Mr. Mnuchin that the entire European Union must be exempt from the steel and aluminum tariffs. In what he characterized as a “frank” discussion, Mr. Le Maire warned that time is running out to reach an agreement and that bilateral negotiations with European countries on the matter were not acceptable. Mr. Trump detests multilateral negotiations and that has been a sticking point with the United States when embarking on trade talks.
“We are waiting for the United States to show some good will towards Europe,” Mr. Le Maire said, adding that while France agrees that China’s steel overcapacity is a global concern, a trade war is not the answer. “Going the way of protectionism will lead nowhere.”
He added, “It will make only losers, not winners, including the United States.”
Before the meeting, Olaf Scholz, Germany’s finance minister, also sounded an alarm. “I am seriously concerned that the foundation of our prosperity — free trade — is being put at risk,” he told the German newspaper Bild.
At the G-20, concerns about rising trade barriers muted enthusiasm about the recent run of strong economic growth around the world. The International Monetary Fund listed in a report prepared before the meetings that “inward-looking policies” could pose a risk to the global economy. Timothy D. Adams, the president of the Institute of International Finance, warned that a trend toward “de-globalization” could harm consumers.
“Protectionism is creeping and seeping in all corners of the economy,” Mr. Adams said.
The Trump administration’s trade agenda is provoking consternation among veterans of previous administrations, who lament the United States’ abdication as a vocal promoter of the gains from free and open markets.
“We worked very hard to drive the agenda toward having open markets, free trade, inclusive growth and not interfering in currency in an unfair way,” Jack Lew, who served as Treasury secretary under President Barack Obama, said in an interview this month. “I don’t know if that’s where the U.S. is pressing the G-20 to go right now. It doesn’t seem to be.”
Desmond Lachman, a scholar at the conservative American Enterprise Institute and a former deputy director for policy at the International Monetary Fund, said it was remarkable to see the United States adopting an isolationist policy.
“The Europeans are furious with what the U.S. is doing,” Mr. Lachman said. “For 70 years, the United States has been the leader in the call for open markets and global markets. Now they are in the opposite position.”
Supporters of Mr. Trump, however, have cheered Mr. Mnuchin’s approach to China on steel and intellectual property.
“It is a bit rambunctious for the Trump administration to approach the issue this way, but it’s certainly more effective than continuing the polite conversations that have been avoiding the real challenges for some time now,” said Scott Paul, the president of the Alliance for American Manufacturing. The group is among those supporting the tariffs, seeing them as a way to protect United States manufacturers against the forces of global trade.
In the interview on Monday, Mr. Mnuchin was unapologetic about Mr. Trump’s tariffs and insisted that the United States was merely responding to unfair trade practices of others countries.
“We’re not going to be afraid to defend our trade positions,” he said. “We don’t want to get into trade wars, but we also want to protect U.S. companies and U.S. rights and have free and fair trade.”

International Trade and World Market,United States Economy,Protectionism (Trade),Customs (Tariff),Commerce Department,United States Politics and Government,Group of Twenty,Mnuchin Steven T,Trump Donald J

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