Tariffs and National Security

In May 2018 the US Department of Commerce started to investigate the car industry to determine whether imports created a national security risk. Usually, these investigations are initiated by either firms in the industry or by unions but curiously both opposed the investigation. The Motor and Equipment Manufacturers Association, which represents auto parts suppliers, warned that “tariffs will shrink investment in the United States at a time when the auto industry is already reeling from declining sales, Trump’s tariffs on steel and aluminum, and tariffs on auto parts from ChinaThese tariffs, if applied, could move the development and implementation of new automotive technologies offshore, leaving America behind… Not a single company in the domestic auto industry requested this investigation.”

Safeguard investigations are allowed to last up to 270 days and on February 17, 2019, two (!) hours before the 270 day deadline was up, the US Department of Commerce sent its report to the White House, triggering a 90-day review period for Trump to decide whether to impose tariffs (IF the report found national security issues). These 90 days were supposed to be up on May 17, 2019, but this has not stopped the White House from a) keeping the report secret although it has a statutory legal obligation to make it public, b) threaten car tariffs.

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