Trump imposes tariffs on steel and aluminum imports with exemptions

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President Donald Trump announced last week that tariffs will be imposed on steel and aluminum with some relief for U.S. allies.

The 25 percent tariff on steel and 10 percent tariff on aluminum is set to take effect late next week. The tariffs will currently be exempt for Canada and Mexico as negotiations on the North American Free Trade Agreement (NAFTA) takes place. It’s the largest step Trump has taken to favor American industries over foreign ones, but it might not be as big of a win as he hopes it will be.

“It’s going to make life more expensive for everyday Americans,” Garrick Taylor, vice president of government relations and communications for the Arizona Chamber of Commerce and Industry says. “It’s going to drive the prices up of the goods Americans buy of everything from appliances to automobiles. It’s going to make American made goods less competitive overseas because of retaliation.”

Taylor says that it helps slightly that Canada and Mexico are currently exempt. At the moment, Canada is the number one steel supplier for the U.S followed by Brazil and South Korea. However, no one can say for sure how long they will stay exempt. Taylor says pending the outcome of the NAFTA negotiations, that could change.

It’s a good chance that the tariffs are “prompted by a desire to stick it to China for dumping steel on the market,” Taylor says. However, instead of being directed strictly to China, it’s affecting everyone. The approach comes from Trump’s adviser on the matter, Peter Navarro.

Trade is a balance of selling and buying. Taylor says it would be better if we didn’t have these tariffs because it feeds into the idea of protectionism. Protectionism is the idea of protecting domestic production from foreign production by taxing imports.

Taylor says the tariffs will only make our goods less competitive, less competitive overseas and lead to higher prices for consumers.

“Trade wars only means losers. No one wins, you only lose,” Taylor says. “Consumers get hurt, producers get hurt… Trump does not believe in win-win scenarios. He believes in winners and losers.”

TED SIMONS: CIA DIRECTOR MIKE POMPEO WILL SUCCEED REX TILLERSON AS SECRETARY OF STATE PENDING WITH SENATE CONFIRMATION. PRESIDENT TRUMP DELIVERED WITH A CAMPAIGN PROMISE BY IM POSING A 25% TARIFF ON STEEL AND 10% ON ALLUMINUM. THE ARIZONA OF CHAMBERS OF COMMERCE AND INDUSTRY IS AGAINST THE TARIFFS AND CALLING FOR ACT AND WE HAVE GARRICK TAYLOR.

GARRICK TAYLOR. THANKS FOR HAVING US IN.

TED SIMONS: THE CHAMBER CALLS THIS MOVE THAT IT FAILS ECONOMICS 101 YOU'RE NOT HAPPY WITH IT WHY?

GARRICK TAYLOR: NOT HAPPY. IT'S GOING TO MAKE LIFE MORE EXPENSIVE FOR EVERYDAY AMERICANS. IT'S GOING TO DRIVE THE PRICES UP OF THE GOODS THAT AMERICANS BUY FROM EVERYTHING FROM APPLIANCES TO AUTOMOBILES, ALSO IT'S GOING TO MAKE AMERICAN MADE GOODS LESS COMPETITIVE OVERSEAS FOR RETALIATION AND SOMETHING I'M SURE WE WILL TALK ABOUT SOON.

TED SIMONS: HE DOES HAVE EXEMPTIONS WITH CANADA AND MEXICO. CANADA BEING THE NUMBER ONE STEAL PROVIDERS RIGHT NOW FOR THE U.S. DOES THAT HELP MATTERS AT ALL?

GARRICK TAYLOR: SLIGHTLY. WE HAVE INJECTED A NEW LEVEL OF UNCERTAINTY IN THE ECONOMY ANYWAYS. WHEN THIS IDEA WAS FIRST ROLLED OUT IT WAS NOT CLEAR THERE WOULD BE COUNTRY EXEMPTIONS WITH THE ANNOUNCEMENT AND SAID CANADA AND MEXICO WOULD BE EXEMPT PENDING THE OUTCOME OF NAFTA NEGOTIATIONS AND IF HE DIDN'T LIKE WHAT HE GOT OUT OF NAFTA DEAL HE WOULD PUT THEM ON A NAUGHTY LIST, CANADA IS OUR LARGEST SOURCE OF IMPORTED STEEL AND FAR AND AWAY THE LEADERS. MEXICO NOT FAR BEHIND AT NUMBER THREE AND SOUTH KOREA AT NUMBER TWO. THE TARIFFS SEEM TO BE PROMPTED BY A DESIRE TO STICK IT TO CHINA WHICH THE ADMINISTRATION BELIEVES IT'S DUMPING STEEL ON THE MARKET AND IT DOES NOT SEEM TO BE TARGETED HOWEVER IN CHINA IT'S REALLY IN EVERYBODY.

TED SIMONS. YES, I WAS GOING TO ASK ABOUT THAT WHY WOULD IT BE WRONG TO ACT AGAINST CHINA FOR DUMPING STEEL ON THE MARKET. THIS IS HIS IDEA OF DOING SOMETHING ABOUT IT, IS HE WRONG?

GARRICK TAYLOR: THAT IS RIGHT IF HE WERE REALLY THAT WORKED UP ABOUT CHINA SPECIFICALLY. WE ASKED THE QUESTION WHY NOT DEVISE A POLICY THAT DEALS WITH THAT COUNTRY SPECIFICALLY INSTEAD IT'S SCATTER SHOT APPROACH THAT COMES OUT OF THE MIND OF PETER NAVARO HIS ADVISOR ON THIS IS A PROTECTION CRANK AND WHAT HE HAS COME UP WITH. THE PRESIDENT SEEMINGLY BOUGHT INTO THAT AND IT WAS HE WHO SAID WE SHOULDN'T HAVE COUNTRY EXEMPTIONS AND FORGET CANADA AND MEXICO. EVERYBODY SHOULD BE HIT WITH THIS PENALTY IF WE ARE TARGETING CHINA THIS IS A VERY ODD WAY TO GO ABOUT IT.

TED SIMONS: WITH THAT IN MIND THE PRESIDENT STILL SAYS THAT CURRENT TRADE CONDITIONS ARE UNFAIR TO THE UNITED STATES. DOES HE HAVE A POINT?

GARRICK TAYLOR: I DON'T THINK HE DOES. YOU KNOW, THIS IS THE SYSTEM OF TRADE MEANS THAT WE ARE BUYING AND SELLING GOODS. IT'S BETTER THAN WE DO NOT HAVE THESE TARIFFS BECAUSE PROTECTIONISM GETS PROTECTIONISM. YOU WILL PUT TAXES ON MY IMPORTS TELL YOU WHAT I WILL STICK IT TO YOU. OUR TRADE MEMBERS ARE NOT DUMB AND CAN READ THE MAPS AND THE BLUE WALL THE PRESIDENT BROKE DOWN IN THE ELECTION. THE UPPER MIDWEST STATES THEY CAN TARGET GOODS OUT OF THERE AND HARLEY DAVIDSON EXPORTED OVERSEAS AND MAKE THOSE MORE EXPENSIVE.

TED SIMONS: THERE IS ALREADY TALK OF THAT.

GARRICK TAYLOR: YOU KNOW, ALREADY TALK OF THAT, MAJORITY MITCH MCCONNELL FROM KENTUCKY IMPORT OR EXPORT KENTUCKY BOURBON, WE CAN MAKE THAT MORE EXPENSIVE FOR LIQUORS OVERSEAS AND MAKES US LESS COMPETITIVE AND MORE EXPENSIVE OVERSEAS AND CONSUMERS DEALING WITH THE INPUTS PRICES WILL GO UP.

TED SIMONS: YET THE PRESIDENT HAS SAID THIS IS A QOUTE,” THE TRADE WARS ARE GOOD AND THEY ARE EASY TO WIN” AND THE ADDENDUM THEY ARE GOOD IF YOU ARE THE UNITED STATES AND IN THIS POSITION AGAIN DOES HE HAVE A POINT?

GARRICK TAYLOR: I DON'T KNOW HOW HE HAS ARRIVED AT THIS CONCLUSION. TRADE WARS ONLY MEAN LOSERS. NOBODY WINS. YOU ONLY LOSE. CONSUMERS GET HURT PRODUCERS GET HUR.
TED SIMONS:BUT THAT GOES BACK TO WHAT THE PRESIDENT DOES IN A VARIETY OF THINGS HE IS ZERO SUM KIND OF GUY AND NO WIN-WIN WITH PRESIDENT TRUMP YOU HAVE A WINNER AND A LOSER AND IT EVENS OUT.

GARRICK TAYLOR: THAT IS TRUE YOU MAKE A GOOD POINT HE DOES NOT BELIEVE IN WIN-WIN SCENARIOS. HE IS A BELIEVER IN WINNERS AND LOSERS. HE LOOKS AT TRADE DEFICITS AS A SIGNAL WE ARE LOSING. HE DOES NOT TAKE IN CONSIDERATION THE FACT IT MEANS CHEAPER INPUTS INTO THE MANUFACTURING PROCESS WITH RESULT WITH BETTER PRODUCTS. CHEAPER PRODUCTS AND BETTER QUALITY AND WE IMPORT WHAT WE CANNOT GET DOMESTICALLY AND CREATES A WIDER OPTIONS DOMESTICALLY HE DOESN'T LOOK AT THAT AND WE DISAGREE.

TED SIMONS: HE AND SUPPORTERS REALLY EMPHASIZED THIS POINT THAT THE SITUATION AS IT EXISTS NOW THREATENS OUR SECURITY, WE NEED A HOME GROWN STEEL, AND WE NEED THESE INDUSTRIES BECAUSE YOU NEVER KNOW WHEN YOU'RE GOING TO NEED IT FOR MILITARY PURPOSES AND SECURITY CONCERNS. AGAIN, IS HE ON THE RIGHT TRACK WITH THAT?

GARRICK TAYLOR: IT'S BIZARRE THAT HE INJECTED NATIONAL SECURITY INTO THIS DEBATE BECAUSE ONE OF THE TOP SOURCES OF FOREIGN STEEL IS SOUTH KOREA YOU MIGHT HAVE NOTICED SOUTH KOREA IS IN KIND OF A ROUGH NEIGHBORHOOD RIGHT NOW AND ONE OF THE FEW ALLIES WE HAVE RIGHT NOW IN THAT PART OF THE WORLD AND IT WOULD SEEM STRANGE THAT WE WOULD BRING NATIONAL SECURITY INTO THIS ISSUE. ANYBODY FEEL THREATENED FROM A NATIONAL SECURITY STANDPOINT FROM OUR SOUTHERN NEIGHBOR MEXICO? IT'S A VERY STRANGE ATTEMPT TO AGAIN DEAL WITH CHINA AND THEN TO BRING UP A NATIONAL SECURITY ISSUE.

TED SIMONS: YOU MENTION CHINA AND A MORE LIMITED AND MORE FOCUSED APPROACH IF YOU DON'T LIKE WHAT CHINA IS DOING THEN THEY DO HAVE YOUR TRADE WAR WITH CHINA IS IT WISE TO HAVE IN OTHER WORDS WAS THIS A WAY A MORE GRACEFUL WAY TO GET THIS DONE WITHOUT SPECIFICALLY POINTING AT CHINA AND YOU GET A FULL BLOWN TRADE WAR THERE?

GARRICK TAYLOR: PERHAPS HE HAS BEEN PLAYING FOOTSIE WITH THE PRESIDENT OF CHINA, HE HAS BEEN APPROACHING THEM WITH A RATHER SOFT TOUCH AT LEAST RHETORICALLY AND HAVE SEEN THAT WITH RUSSIA AND STILL WHAT HE IS DOING IS AN ATTEMPT IF HE INDEED IS ATTEMPTING TO PUNISH CHINA SOMEHOW WITH THIS TRADE POLICY IT'S A VERY STRANGE WAY OF GOING ABOUT IT BECAUSE HE IS HURTING OUR OWN ALLIES AND OUR OWN TRADE PARTNERS AND ULTIMATELY HURTING THE VERY PEOPLE WHO ELECTED HIM TO OFFICE.

TED SIMONS: YOU TOUCHED ON THIS EARLIER IMPACT ON THIS MOVE ON NAF-TA TALKS.

GARRICK TAYLOR: YES, THIS IS WHAT IS HANGING OUT THERE AND REMEMBER HE ROLLED THIS POLICY IDEA OUT WHEN OUR NEGOTIATORS WERE IN MEXICO CITY FOR THE LAST THE LAST ROUND OF TALKS. THAT'S VERY UNUSUAL TIMING. HE SUMMONED NAF-TA BACK TO WASHINGTON TO MEET WITH AUTO MAKERS AND HAD THEM IN THE OVAL OFFICE TO GIVE A DRESSING DOWN TO AUTO MAKERS. IT IS THE TIMING. THE TIMING IT REALLY COULDN'T BE WORSE. LET'S DEAL WITH THE ISSUE OF NAFTA AND GET THE BEST MODERNIZED DEAL POSSIBLE AND PUT THE STEEL TARIFF ISSUE ON THERE ON ONE HAND HE IS NEGOTIATING WITH OUR FRIENDS MEXICO AND THE OTHER HE IS SLAPPING TARIFFS.

TED SIMONS: HE SAYS TARIFFS WILL PROTECT THE COUNTRY AND THEY WILL PROTECT WORKERS.

GARRICK TAYLOR: DON'T BUY IT HURTS WORKERS AND HURTS THE ECONOMY AND MAKES LIFE MORE EXPENSIVE AND MAKES THE JOBS THAT GO WITH THEM HARDER TO COME BY.

TED SIMONS: SO OTHER THAN THAT, HE GOT IT RIGHT.

GARRICK TAYLOR: YEAH HE CAME CLOSE.

TED SIMONS: GARRICK TAYLOR, ARIZONA CHAMBER OF COMMERCE GOOD TO HAVE YOU HAVE HERE THANKS FOR JOINING US.


TED SIMONS: COMING UP, WE WILL LOOK AT ONE OF THE LAST HOMES DESIGNED BY FRANK LLOYD WRIGHT ON THE MARKET IN ARIZONA.

Garrick Taylor: Senior Vice President of Government Relations and Communications, Arizona Chamber of Commerce and Industry

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