‘Don’t drag your best friend into trade dispute,’ Trump warned
‘CRAZY’ THAT CANADA EVEN HAS TO ARGUE FOR EXEMPTION: MINISTER
WASHINGTON, D.C. •Theytriedto be polite, to stress the long history of amity between the two countries.
But Canadian officials seemed almost astonished Thursday as they made a case for what seemed obvious to them: Canada is not a national security threat to the U.S., and shouldn’t be slapped with devastating tariffs on auto imports.
Kirsten Hillman, Ottawa’s deputy ambassador to the States, and Ontario cabinet minister Jim Wilson added to a near-unanimous chorus of opposition to President Donald Trump’s suggested defence-related tariffs on imported vehicles during a packed day of hearings on Capitol Hill.
If Canada is not, in fact, spared the trade penalty, it will respond with “proportionate” tariffs of its own, Hillman warned.
They were joined by American auto makers, business groups and think tanks that predicted such tariffs would kill thousands of jobs south of the border, make cars pricier — and even trigger a spike in auto thefts and crashes.
Wilson, the newly installed economic development minister in Ontario’s Progressive Conservative government, said that while he appreciated the chance to appear, it was “crazy” the Canadians even had to argue they should be exempted. “We’re just trying to make sure our strong ties and friendship with the U.S. are maintained, and we’re not dragged into whatever is irritating the president,” Wilson told reporters after his presentation.
“Our workers have done nothing. They don’t deserve to be treated like this,” he added. “If he’s angry or perturbed in some way with China or with Mexico, deal with those issues. Don’t drag your best friends, your allies into this dispute.”
Hillman reminded the U.S. commerce department officials holding the hearings that they were investigating automobiles and auto parts, “not tanks, not battleships.”
“So what is the nexus between civilian vehicles and national security?” she asked. “There is none, and there’s no basis for finding one.”
Wilbur Ross, Trump’s commerce secretary, listened to some of the presentations earlier in the day after insisting the outcome was not, as some outside experts have charged, a foregone conclusion.
The industry itself — both American and foreign manufacturers with plants here –presented an unbroken front against the tariff proposal.
“The unity is as remarkable as it is unprecedented,” said John Bozella, representing international companies as president of the Association of Global Automakers.
“The greatest threat to the U.S. industry at this time is the possibility that the administration will impose a tax on imports.”
An official of the American Automotive Policy Council, which advocates for the big three U.S. auto firms, made an argument that was repeated often Thursday: the tariffs would increase car prices by thousands of dollars each, decrease demand and as a result trigger widespread layoffs — an estimated 200,000 initially, more than 600,000 with retaliation from other countries.
The hearings are part of a commerce department investigation Trump requested into whether auto imports violate Section 232 of the Trade Expansion Act, which allows the president to unilaterally impose tariffs if reliance on an import is deemed a threat to national security.
The administration has already slapped such tariffs on steel and aluminum brought in from Canada and other nations, and has just launched a separate national security investigation on uranium imports, a sector where Canada is one of the market leaders.
Despite the aura of an investigation and the attempts to gather public input, analysts say the Section 232 process is largely political, one even suggesting recently the hearings would be a “show trial.”
But Ross said Thursday that no decisions have been made.
“It’s clearly too early now to say if this investigation will ultimately result in a Section 232 recommendation on national security grounds,” he said. “But President Trump does understand how indispensable the U.S. automobile industry is … It provides a backbone for our industrial economy.”
Just one presenter — a union — offered some support for the tariff idea, while warning against “rash” action. It fell to the United Auto Workers to voice a measure of support for the Republican president, calling the investigation long overdue.
The UAW’s Jennifer Kelly described a history over the last two decades of American car-making jobs disappearing offshore, especially to countries like Mexico and China that pay their employees relatively little.
The U.S. imported about 2.5 million vehicles last year from its southern neighbour, where auto workers can make just $1 to $3 an hour, she said, while the American trade deficit in autos soars.
But most of the presenters said the auto industry is thriving, and needs to access some of its product from low-wage countries to stay competitive with Europe and other regions.
Meanwhile, one speaker suggested tariffs could have a surprising unintended consequence. As the cost of imported parts rose, motorists would be more likely to forego repairs, a proven factor in road accidents, said Chuck Pluczinki of the Certified Automotive Parts Association. Car thefts would also likely rise, he said, the purloined vehicles used for parts.