Commerce Secretary Wilbur Ross Ross credited hefty steel and aluminum tariffs for an agreement between the U.S. and the European Union that is kick-starting trade negotiations.
Ross said that without the steep tariffs on metals, President Trump and European Commission President Jean-Claude Juncker would not have been able to announce a trade truce on Wednesday to begin resolving a dispute over the tit-for-tat tariffs in the hopes of avoiding a trade war.
{mosads}”If we hadn’t had steel and aluminum tariffs, we never would have gotten to the point we are now,” Ross said aboard Air Force One heading to Iowa according to the press pool report.
“This is a real vindication of the president’s trade policy,” he said.
Trump imposed tariffs of 25 percent on steel and 10 percent on aluminum for national security reasons on the EU along with other allies such as Canada and Mexico after dropping their exemption in May.
The move led to a rapid response with the top trading partners hammering iconic U.S. goods with tariffs.
The agreement comes a day after the Trump administration announced $12 billion in emergency aid for farmers because of the president’s barrage of new duties that led to retaliation with tariffs by China and other close allies.
Ross told reporters that the metals tariffs are creating jobs and that many companies are using the president’s trade policy as an “excuse” for laying off workers or reporting lower earnings.
He said the administration’s numbers “do not show that employment is being hurt.”
Meanwhile, senators argued that many industries in their states are being pummeled by the tariffs imposed by China, Mexico and Canada, among other countries.
Republican Sens. Lisa Murkowski (Alaska) and Susan Collins each told U.S. Trade Representative Robert Lighthizer during a Senate hearing that their fisheries industries — including Maine lobsters — have taken a hard hit by Chinese tariffs on U.S. seafood.
Murkowski said that seafood tariffs have “rattled” her state.
Lighthizer was in the hot seat on tariffs at the Senate Appropriations subcommittee hearing that was supposed to be about USTR’s 2019 budget but it never ventured into that territory.
Sen. Lamar Alexander (R-Tenn.) asked whether the administration would be willing to start the U.S.-EU talks by equalizing car tariffs, possibly on the way to zero.
Lighthizer argued that the White House can’t cherry pick those types of changes.
But Alexander shot back that raising steel and aluminum tariffs is doing exactly that and the decision by the administration has sent steel prices skyrocketing 40 percent since January, hurting various industries throughout his home state.
In May, Trump removed an exemption for the EU and slapped tariffs of 25 percent on imported steel and 10 percent on aluminum.
The bloc responded with retaliatory tariffs on iconic U.S. goods including jeans, bourbon and motorcycles. Canada and Mexico also put hefty tariffs in place on a wide range of American products.
The Obama administration spent several years trying to negotiate a multi-trillion deal with the EU — the Transatlantic Trade and Investment Partnership (TTIP).
But Trump didn’t renew those talks or suggest a new round of formal talks with the EU until now.
EU leaders have traveled back and forth to Washington in recent months to strike a deal on a long-term waiver from the metals tariffs. But U.S. officials said they weren’t satisfied with their offers and Trump went ahead with the duties.
On Wednesday, the EU said it would increase U.S. soybean imports, lower industrial tariffs with the aim of dropping them to zero and work more closely together on regulations and energy, including buying more more liquified natural gas (LNG). They trading partners also intend to work on reforms to the World Trade Organization (WTO).
How sales of gas and soybeans to the EU will work is still to be determined.
The American Soybean Association (ASA) said it was eager to learn the details of the agreement.
“We look forward to learning the details of the agreement and working with USTR, and welcome the opportunity to deepen our relationship with our trading partners in Europe,” said John Heisdorffer, ASA president and an Iowa soybean farmer in a statement.
Ross said that the Trump administration will attempt to do U.S.-EU negotiations much faster that the normal process, which under Obama has turned into three years.
The U.S. and EU will “hold off on other tariffs” while negotiations proceed, Juncker said.
With the promise of no new tariffs, Trump is stepping back from his threats to slap 25 percent tariffs on foreign autos and auto parts for now.
But Ross said the investigation into whether auto tariffs are needed will continue.
“In terms of auto tariffs, we’ve been directed by the president to continue the investigation, get our material together but not actually implement anything pending the outcome of the negotiation,” he said.
Ross is expecting to submit the auto tariffs report to Trump sometime in August and said that imposing the auto tariffs “may not be necessary.”
“What we’ve agreed is not to impose automotive tariffs while the negotiations are underway,” Ross said.