Commerce Secretary Wilbur Ross appears for an interview with Trish Regan immediately after President Trump signed the Presidential Proclamation to advance Steel and Aluminum tariffs to protect and expand American industry. [DEEP DIVE]
Ms. Regan is one of the financial business analysts who have slowly evolved away from the insufferable Wall Street/U.S. Chamber of Commerce ‘globalist’ viewpoints, which was/is entirely built upon a false premise. Thankfully Ms. Regan joins the ranks of economic patriots Charles Payne and Lou Dobbs. We’ll keep working on Maria Bartiromo.
In this interview Secretary Ross elevates the discussion beyond just Steel and Aluminum and begins to expand -and emphasize- the perimeter of an entirely new American approach toward trade, “reciprocity“. Indeed for the very first time in this interview Secretary Ross gives a preview into what will follow and how ‘reciprocity’ will be applied.
“President Trump is taking action today to protect both our national security and industries critical to our economy. The President’s decision regarding the steel and aluminum Section 232 reports are the result of a long and well-thought-out process led by the Commerce Department. Once again, President Trump is keeping his promises and standing up for American families, American businesses, and American workers.” ~ Commerce Secretary Wilbur Ross
The specific target has always been China; and POTUS Trump, Commerce Secretary Wilbur Ross, USTR Robert Lighthizer and Trade Policy Adviser Peter Navarro know to hit their target they have to get past the hurdle of trans-shipments of Steel to proxy nations by China to avoid the tariff.
So what does POTUS Trump do…. he takes the position of the tariff opponents and amplifies it. Trump’s trade policy opponents, realizing something was going to happen regardless of their opposition, started demanding “targeted tariffs”; that is, tariffs applied against target nations. POTUS Trump brilliantly spins their position and says: ok, let’s target by granting “exceptions” to the tariffs.
What POTUS will announce is “targeted exemptions” to the trade tariffs on Steel and Aluminum. Not “targeted tariffs”, but rather “targeted exemptions”.
The exemption approach puts more power in the hands of Team ‘America-First’ than targeting the steel dumpers directly. Team Trump will reward good behavior.
Any nation that acts like a Chinese proxy in the trans-shipment problem will not get relief from the tariffs. However, the nations that manufacture and trade honestly will be granted tariff relief. This allows Team Trump to evaluate the origin of the Steel used by countries that want to import their finished goods into the U.S. If they are using Chinese Steel, the tariff applies. If they are using their own manufactured steel, there is no tariff.
See how brilliantly that works?
By taking the position of his opposition and modifying it to enhance his own policy, POTUS has gained leverage. The U.S.A. now holds the strength of enforcement based on American determination of origin of their material. If the producing nation doesn’t follow the Trump rules, they will pay the tariff. In essence, Trump is helping all manufacturing nations by positioning the United States as the “steel compliance office”. We will determine who is using Chinese Steel and who is not.
This also gives Trump, Ross and Lighthizer massive leverage against China. No country will want to lose access to the U.S. market by engaging in the sketchy trans-shipping arrangement with China. POTUS Trump holds all the cards.
This approach also puts Mexico and Canada (NAFTA) on notice that if they use Chinese steel they will face a tariff despite our NAFTA agreement. Again, more leverage.