Republicans open to targeted China tariffs despite steel flap

Republican lawmakers who broadly shunned President Trump’s wide-ranging steel and aluminum tariffs are expressing more optimism about a potential new round of trade actions that specifically target China.

While some are urging caution out of fears of sparking a trade war with Beijing, others are signaling confidence in such an approach, characterizing China as the justified target of any punitive trade measures.

“Obviously there’s a huge difference,” said Rep. Tom Rice (R-S.C.), a member of the House Ways and Means Committee, which oversees trade.

“I think that the retaliatory tariffs are there for a reason, to deal with bad actors. I don’t think anybody argues that China hasn’t taken advantage of us, and that it hasn’t hurt the American middle class,” he added.

Trump is said to be considering imposing tariffs on up to $60 billion worth of Chinese imports following an investigation under “Section 301” of the trade act, which covers intellectual property. {mosads}

China has frequently been accused of stealing intellectual property from U.S. companies, as well as subsidizing certain goods and dumping materials into the world market at the expense of other producers.

White House trade adviser Peter Navarro told CNBC this week that Trump would receive recommendations from U.S. Trade Representative Robert Lighthizer in the coming weeks on how to respond to “China’s theft and forced transfer of our intellectual property.”

Lighthizer had originally suggested a $30 billion package of tariffs on imports from China, according to multiple reports, but the president wanted to double that figure, covering a range of more than 100 products.

Republicans are more optimistic about the administration taking targeted action against China after numerous GOP lawmakers, including Speaker Paul Ryan (R-Wis.), opposed Trump’s recent move to impose sweeping tariffs of 25 percent on steel and 10 percent on aluminum.

Trump excluded Canada and Mexico from those tariffs after heavy lobbying, and many members of his party continue to quietly push him to exempt additional U.S. allies from the import taxes.

House Ways and Means Committee Chairman Kevin Brady (R-Texas) told Fox News on Friday that lawmakers would continue working with the White House and Commerce Secretary Wilbur Ross on developing an exclusion process for products that would get trapped in the tariffs.

“It’s really important that the Commerce Department narrow those tariffs to make sure these fairly traded products aren’t swept in,” Brady said.

Ross is scheduled to testify before the Ways and Means panel on Thursday, the day after Lighthizer appears before the committee. Lawmakers are expected to pepper the two officials with questions about their concerns surrounding the tariffs and the Trump administration’s broader trade agenda.

“I think everybody approaches the tariff discussion sobered and concerned. That said, the issue of Chinese activity is where the scrutiny should lie,” said Rep. Peter Roskam (R-Ill.), another Ways and Means member.

“The blanket tariffs on steel directly hurt my district. I represent small manufacturers that use a lot of steel, it’s imported, and this hurts them,” he said.

“Let me put it this way, nobody’s doing a candlelight vigil for the Chinese.”

Like many Republicans, Rep. David Schweikert (Ariz.), a staunch free-trader, said he approved of the overall policy thinking on targeted actions against China but said that details of the proposal would be critical.

“I’m a fan of, if you’ve documented someone cheating, deal with the bad act. If other countries are playing by the rules, respect that and understand that,” he said. Tariffs, he added, are only one tool in the box.

“Are we exhausting the levers that are available to us? Turns out, most of the time we go to the [World Trade Organization], we win,” he said.

Some Republicans remain concerned that that new tariffs would lead to a trade war with China.

“On the retaliatory side, obviously sorghum, soybean, those guys are generally concerned about the impact that that would have,” said Rep. Mike Conaway (R-Texas), who heads the House Agriculture Committee.

But he remained open to giving the administration the benefit of the doubt.

“Mr. Trump has shown himself to be an adept negotiator, and so we’ll see where he goes,” he said.

Chinese foreign ministry spokesman Lu Kang told reporters this week that the U.S. should expect its own response to new tariffs.

“If the United States takes actions that harm China’s interests, China will have to take measures to firmly protect our legitimate rights,” he said, according to Reuters.

The business community, which has often seen the GOP as a steward of its interests, is also voicing concerns about Trump taking broad action against Beijing.

“The administration is right to focus on the negative economic impact of China’s industrial policies and unfair trade practices, but the U.S. Chamber would strongly disagree with a decision to impose sweeping tariffs,” said Thomas J. Donohue, CEO of the U.S. Chamber of Commerce.

Tariffs, he said, would “wipe out” a significant chunk of the benefits of the GOP tax law.

Democrats are more skeptical that Trump would be able to thread the needle with retaliatory measures.

“The president will propose tariffs, but what is not taken into consideration is how the cost of those tariffs are passed onto American consumers. So in the end, what is achieved other than the president getting his licks in?” asked Rep. Brian Higgins (D-N.Y.), another Ways and Means member.

Rep. Richard Neal (Mass.), the top Democrat on the committee, raised a similar concern.

“They seem to be making it up as they go along,” he said of the administration’s trade policy.