Washington will be focused on two major showdowns over economic policy in the coming week as the president’s new tariffs and legislation to rollback Dodd-Frank banking rules both see action.
The Trump administration is set to start implementation of tariffs on imported steel and aluminum that the president signed Thursday.
Trump said imposing the tariffs, 25 percent on steel and 10 percent on aluminum, were essential to protecting U.S. manufacturing and national security. But the issue has Trump at odds with his own party. Republicans have almost unanimously opposed the tariffs and are pushing for significant changes.
GOP leaders in Congress are pushing Trump to narrow the tariffs, which they say should be focused on unfairly traded goods and those countries that are violating trade laws.
House Speaker Paul Ryan (R-Wis.) said Thursday he feared the “unintended consequences” of broad tariffs, and Senate Finance Committee Chairman Orrin Hatch called the fees a tax on U.S. workers.
Sen. Jeff Flake (R-Ariz.), a staunch Trump critic, said he’d introduce a bill to nullify the tariffs.
“These so-called ‘flexible tariffs’ are a marriage of two lethal poisons to economic growth — protectionism and uncertainty. Trade wars are not won, they are only lost. Congress cannot be complicit as the administration courts economic disaster,” Flake added on Thursday.
U.S. trading partners have vowed to impose tariffs of their own on American imports if Trump forges ahead with broad tariffs. But the administration has sought to limit the possibility of angering key allies, particularly Canada and Mexico. The White House said that those countries would be exempted from the tariffs as talks to renegotiate the North American Free Trade Agreement continue.
Treasury Secretary Steven Mnuchin said Friday that countries beyond Mexico and Canada could be added to the exemptions list before tariffs go into effect in the next few weeks.
The Commerce Department may also look into removing certain products from the brunt of hefty tariffs, he said.
When asked whether he is concerned the tariff policy could spark a global trade war that hurts the U.S. economy, Mnuchin insisted that “we have to defend U.S. interests.”
“Tariffs are important to preserve the steel industry,” he said.
Tariffs aren’t the only contentious issue on the docket in the coming week.
Lawmakers will also face off over a bipartisan bill to loosen key parts of the Dodd-Frank Act after votes were pushed to next week.
The Senate will vote to end debate on the measure Monday evening, and the bill is poised to pass this week over the objections of liberal Democrats.
A spokesman for Senate Majority Leader Mitch McConnell (R-Ky.) said Thursday that Republicans and Democrats were unable to agree on which of the than 100 amendments to the bill would get votes. The Senate will vote on a series of amendments “early next week,” the spokesman said.
than a dozen Democrats support the underlying measure, and the battle over amendments isn’t likely to change the final outcome.
House conservatives are also pushing for input on the bill. With the GOP searching for accomplishments to tout ahead of the midterm elections, House Republicans who once derided the Senate bill are taking a second look, suggesting they may be open to compromise.
An amendment introduced by the Senate bill’s sponsors included eight bills originating in the House Financial Services Committee, along with other changes meant to woo Democrats.
The panel’s chairman, Rep. Jeb Hensarling (R-Texas), told reporters Thursday that the manager’s amendment didn’t include enough input from the House to win him over, however. He’s pushing for the Senate to include roughly 30 bills from his panel that earned bipartisan support.
“We expect them to be in any bill that goes to the president’s desk,” Hensarling said, insisting the Senate bill didn’t reflect the will of the House.
Sarah Flaim, a Hensarling spokeswoman, later said that Financial Services panel is “not making demands on the Senate bill.”
“This is a list of bills intended to illustrate the hard work of the House on a bipartisan basis,” Flaim said. “The Senate has put forth their bill. The House has its bills. It is our expectation that those bills be reconciled through conference — be it formal or informal.”
But the coalition of Republicans and Democrats backing the Senate bill have expressed worries about the additional changes demanded by Hensarling.
“There will be tremendous pressure on the House to not sink any kind of compromise,” said Sen. Heidi Heitkamp (D-N.D.), a co-sponsor of the Senate bill, on Tuesday.
“This is a moment in time, and I think House leadership understands that.”
Your week ahead:
- Senate votes to end debate on bipartisan bill to loosen Dodd-Frank, 5:30 p.m.
- House Rules Committee: Hearing on three financial services bills, 5 p.m.
- House Foreign Affairs Committee: Hearing entitled “Modernizing Export Controls: Protecting Cutting-Edge Technology and U.S. National Security,” 10 a.m.
- House Financial Services Committee: Hearing on cryptocurrencies and initial coin offerings, 10 a.m.
- House Budget Committee: Hearing on Congressional Budget Office oversight, 10 a.m.
- House Rules Committee: Hearing on two financial services bills, 3 p.m.
- House Financial Services Committee: Hearing on the Committee on Foreign Investment in the United States (CFIUS), 10 a.m.
- House Financial Services Committee: Hearing entitled “After the Breach: the Monetization and Illicit Use of Stolen Data,” 2 p.m.
Recap the week with Overnight Finance:
- Monday: Trump says he won’t back down on tariffs | GOP pressure to pull back grows | Trading partners promise payback | Dems divided over bank rules | Cochran to resign next month
- Tuesday: Cohn resigns from White House | Senate moves forward on Dodd-Frank rollback | House eyes vote on funding bill next week
- Wednesday: Trump expected to sign tariffs Thursday | GOP fears post-Cohn White House | House conservatives warm to Senate deal to ease Dodd-Frank | SEC wants crypto exchanges to register
- Thursday: Trump signs tariffs, defying GOP | Republicans look to narrow tariffs | Vote on Dodd-Frank rollback pushed to next week | Trump says Cohn could return to WH
- Republicans slam Trump’s tariffs plan, by Vicki Needham and Jordain Carney
- Trump: Sanctions on North Korea will stay until deal reached, by Brett Samuels
- Dems tread cautiously on Trump’s tariffs, by Amie Parnes and Jordain Carney
- Economy adds 313K jobs in February, most since July 2016, by Vicki Needham
- Cornyn: Trump aide Navarro ‘has a lot of wrong ideas when it comes to trade,’ by Timothy Cama
- Goldman Sachs chief Blankfein to retire as early as year’s end: WSJ, by Sylvan Lane
- Mnuchin signals changes to tariffs plan, by Vicki Needham
- Warren turns focus to Kushner’s loans, by John Bowden
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