Official Replies
As required under Section 232, the Secretary examined the effect of imports on national security requirements, including: domestic production needed for projected national defense requirements; the capacity of domestic industries to meet such requirements; existing and anticipated availabilities of the human resources, products, raw materials, and other supplies and services essential to the national defense; the requirements of growth of such industries and such supplies and services including the investment, exploration, and development necessary to assure such growth; and the importation of goods in terms of their quantities, availabilities, character, and use as those affect such industries; and the capacity of the United States to meet national security requirements.
National security also encompasses U.S. critical infrastructure sectors including transportation systems, the electric power grid, water systems, and energy generation systems. Domestic steel production is essential for national security applications. Statutory provisions illustrate that Congress believes domestic production capability is essential for defense requirements and critical infrastructure needs, and ultimately to the national security of the United States.
Due to the threat, as defined in Section 232, to national security from steel imports, the Secretary recommends that the President take immediate action by adjusting the level of these imports through quotas or tariffs. The quotas or tariffs imposed should be sufficient, even after any exceptions (if granted), to enable U.S. steel producers to operate at an 80 percent or better average capacity utilization rate based on available capacity in 2017.
National security is a very broadly encompassing topic. It is not just the narrow definition of defense needs, it also covers infrastructure needs and other needs. So we believe and our counsel believes that this is a perfectly valid interpretation of national security the way that it’s used in Section 232, which is much broader than you might think in terms of usual parlance.
There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry. The Department of Commerce will conduct a thorough, fair and transparent investigation into whether such imports are weakening our internal economy and may impair the national security.
On May 23, 2018, I initiated an investigation to determine the effects on the national security of imports of automobiles, including cars, SUVs, vans and light trucks, and automotive parts, under section 232 of the Trade Expansion Act of 1962. Interested parties are invited to submit written comments, data, analyses, or other information pertinent to the investigation by June 22, 2018. The Department of Commerce will also hold a public hearing on the investigation on July 19 and 20, 2018 in Washington, DC. The issues on which the Department is interested in obtaining the public's views, include the following:
• The quantity and nature of imports of automobiles, including cars, SUVs, vans and light trucks, and automotive parts and other circumstances related to the importation of automobiles and automotive parts;
• Domestic production needed for projected national defense requirements;
• Domestic production and productive capacity needed for automobiles and automotive parts to meet projected national defense requirements;
• The existing and anticipated availability of human resources, products, raw materials, production equipment, and facilities to produce automobiles and automotive parts;
• The growth requirements of the automobiles and automotive parts industry to meet national defense requirements and/or requirements to assure such growth, particularly with respect to investment and research and development;
• The impact of foreign competition on the economic welfare of the U.S. automobiles and automotive parts industry;
• The displacement of any domestic automobiles and automotive parts causing substantial unemployment, decrease in the revenues of government, loss of investment or specialized skills and productive capacity, or other serious effects;
• Relevant factors that are causing or will cause a weakening of our national economy;
• The extent to which innovation in new automotive technologies is
The beer, soft drink and soup cans—it’s all a fraction of a penny on each of those. In terms of the automobile it’s also a fraction of 1 percent, and for the economy overall, it’s a very small fraction of 1 percent.
The president has the ability unilaterally to increase tariffs, decrease tariffs, eliminate them, impose quotas, impose a combination of tariffs and quotas — more or less to do anything he wishes.
There has been no decision made as to whether to recommend tariffs at all—we’re at the early stages in the process.
