Trump announces stiff trade tariffs, unswayed by warnings

The Associated Press

WASHINGTON — Unswayed by Republican warnings of a trade war, President Donald Trump ordered steep new tariffs on steel and aluminum imports to the U.S. on Thursday, vowing to fight back against an "assault on our country" by foreign competitors.

The president said he would exempt Canada and Mexico while negotiating for changes to the North American Free Trade Agreement .

The new tariffs will take effect in 15 days, with Canada and Mexico indefinitely exempted "to see if we can make the deal," Trump said. NAFTA talks are expected to resume early next month.

"The American aluminum and steel industry has been ravaged by aggressive foreign trade practices. It's really an assault on our country. It's been an assault," Trump said at the White House where he was joined by steel and aluminum workers holding white hard hats.

American steel and aluminum workers have long been betrayed, Trump said, but "that betrayal is now over." The former real estate developer said politicians for years lamented the decline in the industries, but nobody was willing to take action.

As he has indicated previously, Trump said he would levy tariffs of 25 percent on imported steel and 10 percent on aluminum. But he said during a Cabinet meeting earlier in the day that the penalties would "have a right to go up or down depending on the country and I'll have a right to drop out countries or add countries. I just want fairness."

Business leaders, meanwhile, continued to sound the alarm about the potential economic fallout from tariffs, with the president and CEO of the U.S. Chamber of Commerce raising the specter of a global trade war. That scenario, Tom Donohue said, would endanger the economic momentum from the GOP tax cuts and Trump's rollback of regulations.

"We urge the administration to take this risk seriously," Donohue said.

Reaction in Maryland, where manufacturers rely heavily on steel imports according to a recent study, was largely negative. The Maryland Chamber of Commerce predicted the decision would have "terrible effects on Maryland's economy" and said it would "set back" manufacturing, construction and other industries.

Steel and aluminum make up 5.5 percent of Maryland's imports and, by that measure, the state is ranked fourth in the nation for its use of those products, according to a study from the Brookings Institution this week. Only Missouri, Louisiana and Connecticut had a higher share.

In all, the state brought in $1.7 billion in steel and aluminum last year, according to the report.

Republican leaders on Capitol Hill have tried to persuade the White House against the decision for weeks, and many offered muted criticism Thursday – even though Trump campaigned heavily on a promise to raise tariffs in 2016.

Senate Majority Leader Mitch McConnell said he and other senators were "concerned about the scope of the proposed tariffs" and House Speaker Paul Ryan said he disagrees with the decision and "fear[s] its unintended consequences."

Democrats, including several members of Maryland's mostly Democratic congressional delegation, have also opposed it.

"No one can doubt that China has created massive overcapacity in steel and aluminum production that distorts world markets and depresses steel and aluminum prices," Rep. Steny Hoyer, a Southern Maryland Democrat, said on Thursday. "But our trade actions need to be carefully designed to hit their targets and avoid collateral damage to other U.S. industries or to our allies."

The president suggested in the meeting with his Cabinet that Australia and "other countries" also might be spared, a shift that could soften the international blow amid threats of retaliation by trading partners.

"We're going to be very fair, we're going to be very flexible but we're going to protect the American worker as I said I would do in my campaign," Trump said.

People briefed on the plans ahead of the announcement said all countries affected by the tariffs would be invited to negotiate with the administration to be exempted from the tariffs if they can address the threat their exports pose to U.S. manufacturers. The exemptions for Canada and Mexico could be ended if talks to renegotiate NAFTA stall.

The process of announcing the penalties has been the subject of an intense debate and chaotic exchanges within the White House, pitting hard-liners against free trade advocates such as outgoing economic adviser Gary Cohn.

The fight over tariffs comes amid intense turmoil in the West Wing, which has seen waves of departures and negative news stories that have left Trump increasingly isolated in the Oval Office, according to two senior officials speaking on the condition of anonymity to discuss internal discussions.

Congressional Republicans and business groups are bracing for the impact of the tariffs and the departure of Cohn, a former Goldman Sachs executive who has opposed them.

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.

More than 100 House Republicans wrote Trump on Wednesday, asking him to reconsider "the idea of broad tariffs to avoid unintended negative consequences" to the U.S. economy and workers.

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.

The president has said the tariffs are needed to reinforce lagging American steel and aluminum industries and protect national security.

The Baltimore Sun's John Fritze contributed to this report.

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