Restricting Steel Imports Via National Security Provision Would Have Consequences

Wendy Cutler on Bloomberg

On June 20, 2017, Asia Society Policy Institute Vice President Wendy Cutler spoke on “Bloomberg Daybreak: Americas” about the Trump administration’s decision to potentially restrict steel imports by using a 55-year-old trade provision focused on national security. Section 232 of the Trade Expansion Act of 1962 allows the U.S. government to limit certain imports if an investigation concludes that they would undermine national security. The Trump administration has deployed section 232 with regards to steel imports and has aunched an investigation through the U.S. Commerce Department.

The United States has “only taken two trade actions to date” using the provision, Cutler explained, pointing out that though there have been a number of investigations in the 55 years since the provision has been in place, most have not found “legitimate grounds to restrict imports due to national security concerns.”

Were the administration to go ahead with such a move to restrict steel imports, Cutler said it would “give the green light to our trading partners to also restrict imports on national security grounds.” She further warned that the provision “could be abused and could lead to a trade war if not used judiciously.” Finally, she pointed out that any restrictions would result in an increase in price that could ultimately be passed on to U.S. consumers and adverse impacts on workers in industries that use steel. (2 min. 11 sec.)

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