Congress OKS puni­tive du­ties for Chi­nese im­ports

The Washington Times Daily - - Business - BY SEAN LENGELL

Par­ti­san grid­lock still reigns on Capi­tol Hill, but there’s one thing law­mak­ers agree on — trade penal­ties for China.

The House eas­ily ap­proved leg­is­la­tion Tues­day to grant the Com­merce Depart­ment the right to con­tinue im­pos­ing higher tar­iffs on goods from China and other coun­tries that sub­si­dize their ex­ports to the United States. The mea­sure passed with broad bi­par­ti­san sup­port on a vote of 370-39.

A day ear­lier, the Se­nate passed the bill on a voice vote with­out de­bate.

“China is tilt­ing the field of com­pe­ti­tion by not play­ing by the rules,” said Rep. San­der M. Levin of Michi­gan, the se­nior Demo­crat on the tax-writ­ing House Ways and Means Com­mit­tee. “This bill re­stores a key in­stru­ment for our na­tion to hold China ac­count­able.”

Ways and Means Chair­man Dave Camp, Michi­gan Re­pub­li­can, agreed.

“China dis­torts the free mar­ket by giv­ing enor­mous sub­si­dies to its pro­duc­ers and ex­porters, and our com­pa­nies and work­ers should not be ex­pected to com­pete against the deep pock­ets of the Chi­nese gov­ern­ment,” he said.

The leg­is­la­tion came af­ter a fed­eral ap­pel­late court ruled in De­cem­ber that the Com­merce Depart­ment didn’t have the le­gal au­thor­ity to im­pose puni­tive du­ties be­cause Congress had never ex­plic­itly given the agency that right.

Com­merce has been ap­ply­ing these “coun­ter­vail­ing” du­ties since 2007. The leg­is­la­tion en­sures that 24 ex­ist­ing higher-tar­iff or­ders and six pend­ing in­ves­ti­ga­tions against im­ports from China and Viet­nam will con­tinue to be valid. Of those 24, 23 are di­rected at Chi­nese sub­si­dies.

The du­ties are al­lowed un­der World Trade Or­ga­ni­za­tion rules to coun­ter­act un­fair sub­si­dies used by coun­tries, such as China and Viet­nam, that have yet to fully adopt mar­ket economies.

The Obama ad­min­is­tra­tion pushed hard for the leg­is­la­tion, pre­dict­ing its ab­sence “would have sub­stan­tial ad­verse eco­nomic im­pli­ca­tions for our coun­try.”

“The ad­min­is­tra­tion stands ready to work with Congress to en­act [the] leg­is­la­tion,” said Com­merce Sec­re­tary John E. Bryson and U.S. Trade Rep­re­sen­ta­tive Ron­ald Kirk in a joint let­ter to Mr. Camp and Mr. Levin in Jan­uary. “This mat­ter is of the ut­most ur­gency.”

The Se­nate took the un­usual step of pass­ing the House ver­sion as its own be­fore the lower cham­ber voted on it. The ma­neu­ver al­lows the leg­is­la­tion to be sent di­rectly to the White House for the pres­i­dent’s sig­na­ture.

The anti-tax group Club for Growth op­posed the mea­sure, say­ing the puni­tive tar­iffs would in­crease the cost of im­ports and hurt U.S. con­sumers and busi­nesses.

“Coun­ter­vail­ing du­ties are de­fended as a rem­edy to ‘un­fair trade,’ but the gov­ern­ment gives no con­sid­er­a­tion to the U.S. busi­nesses that rely on cheap im­ports to make their own final prod­uct,” the group said.

But the Na­tional As­so­ci­a­tion of Man­u­fac­tur­ers strongly sup­ported the bill, say­ing that U.S. man­u­fac­tur­ers would be neg­a­tively af­fected and that thou­sands of jobs would be put at risk if the bill isn’t signed into law.

“In or­der to com­pete against our global com­pe­ti­tion, man­u­fac­tur­ers in the United States need a fair and level play­ing field,” said NAM Vice Pres­i­dent of In­ter­na­tional Eco­nomic Af­fairs Frank Vargo.

This ar­ti­cle was based in part on wire-ser­vice re­ports.

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