Trade Update (March 18)
|President Trump’s Fiscal Year 2020 Budget Request
On Monday (Mar 11), Office of Management and Budget (OMB) Acting Director Russ Vought released the president’s budget request. The budget priorities include: curbing wasteful spending, strengthening border security, providing for a robust national defense, combating the opioid epidemic, investing in America’s students, modernizing the government for the 21st century, and caring for veterans. In terms of trade, the budget requests $16 million “to support the President’s robust trade agenda … to protect critical elements of US economic security and level the playing field for American workers, farmers, and manufacturers.” It also supports implementing the John S. McCain National Defense Authorization Act of 2019, which expanded the jurisdiction of the Committee on Foreign Investment (CFIUS) and establishes a new initiative within the International Trade Administration (ITA) “to counter the circumvention or evasion of US trade actions aimed at those who engage in unfair and illegal trade practices.” To view the full budget request click here.
The Export-Import Bank is an independent agency that finances the export of American goods and services. It provides small business exporters with certainty and protection when tackling new markets and levels the playing field for American businesses around the world. However, the bank has been hindered in recent years because Senate Republicans have not confirmed appointees to its board.
On Wednesday (Mar 13), the Senate Banking Committee advanced the nomination of Claudia Slacik to serve on the ExIm’s board. Last month, the committee voted to advance Kimberly Reed to serve as ExIm’s president and Spencer Bachus and Judith Pryor to serve on the bank’s board.
The bank’s charter is set to expire on September 30, 2019, and both Senate Committee on Banking, Housing, and Urban Affairs Chairman Mike Crapo (R-ID) and House Committee on Financial Services Chairwoman Maxine Waters (D-CA) have made reauthorizing the bank a priority for their committees in the 116th Congress. Additionally, President Trump’s budget request underscores his support for the bank as it requests a “fully functioning ExIm Bank to implement reforms and help American exporters compete in an increasingly unfair global marketplace.”
On Tuesday (Mar 12), US Trade Representative Robert Lighthizer announced that the US is working with Canada and Mexico to lift the Section 232 steel and aluminum tariffs. Many lawmakers have expressed concern that USMCA will not be approved by Congress if the tariffs remain in place. Senate Finance Chairman Chuck Grassley (R-IA) echoed calls to lift the tariffs, “You [President Trump] said to these countries [Canada and Mexico], these tariffs are gonna be on till you negotiate. The negotiation’s over. You ought to do your end of the bargain, pull back the tariffs.”
Also on Tuesday, USTR Lighthizer briefed members of the New Democrat Coalition on USMCA. After the meeting, Trade Task Force C-Chair Rep. Ron Kind (D-WI) said, ““Realistically, if we’re going to move it [USMCA], we’re going to have to be serious about pre-August recess. Otherwise, we hit 2020 campaign and this thing could just not happen.”
On Thursday (Mar 14), the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) announced they oppose the USMCA in its current form. The announcement states that the new NAFTA does not do enough to stop the outsourcing of US jobs to Mexico and it does not address existing inequities. The organization wants to see strengthened labor rules with an effective enforcement mechanism, strengthened rules for all manufacturing sectors, strengthened environmental rules and enforcement, and the removal of provisions that undermine income, health care, and pension plans for creative arts workers. To read the full announcement click here.
 “Administration Presents President Trump’s Fiscal Year 2020 Budget Request.” WhiteHouse.gov, 11 Mar 2019. https://www.whitehouse.gov/briefings-statements/administration-presents-president-trumps-fiscal-year-2020-budget-request/
 “A Budget for a Better America: Promises Kept. Taxpayers First.” WhiteHouse.gov, 11 Mar 2019. https://www.whitehouse.gov/wp-content/uploads/2019/03/budget-fy2020.pdf
 “The Facts about ExIm Bank.” ExIm.gov. 2019. https://www.exim.gov/about/facts-about-ex-im-bank
 “Senate Banking Panel Backs Ex-Im, Commerce Nominees (1).” BloombergTax.com, 13 Mar 2019. https://news.bloombergtax.com/international-trade/senate-banking-panel-backs-ex-im-commerce-nominees-1
 “Crapo Outlines Banking Committee Agenda for 116th Congress.” Banking.Senate.gov, 29 Jan 2019. https://www.banking.senate.gov/newsroom/majority/crapo-outlines-agenda-for-116th-congress
 “Waters Outlines Agenda in First Policy Speech as Committee Chairwoman.” FinancialServices.House.gov, 16 Jan 2019. https://financialservices.house.gov/news/email/show.aspx?ID=LSOOG4ZWMHVGE
 “A Budget for a Better America: Promises Kept. Taxpayers First.” WhiteHouse.gov, 11 Mar 2019.
 “US working on steel, aluminum tariff relief for Mexico, Canada: trade chief.” Reuters, Washington. 12 Mar 2019. https://www.reuters.com/article/us-usa-trade-steel/u-s-working-on-steel-aluminum-tariff-relief-for-mexico-canada-trade-chief-idUSKBN1QT2LZ
 Jessica Smith. “You’ve got to get rid of these tariffs: Sen. Grassley.” Finance.Yahoo.com. 1 Mar 2019. https://finance.yahoo.com/news/youve-got-to-get-rid-of-these-tariffs-sen-grassley-201338309.html
 Sabrina Rodriguez. “Trump’s trade chief meets skepticism as he sells new NAFTA to Democrats.” Politico.com. 13 Mar 2019. https://www.politico.com/story/2019/03/13/trump-nafta-democrats-1266166
 “Trade Must Build an Inclusive Economy for All.” AFLCIO.org, 14 Mar 2019. https://aflcio.org/aboutleadershipstatements/trade-must-build-inclusive-economy-all