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An Aluminum Tariff Reprieve

By The Editorial Board


The Trump Administration announced Tuesday that it will lift its 10% tariffs on Canadian aluminum for the last four months of this year. Hallelujah. With Canada threatening to retaliate against U.S. businesses, President Trump must have realized that his tariffs could hurt him politically.

In August the Administration imposed Section 232 tariffs on Canadian aluminum, citing higher import levels than the year before. Tuesday’s reversal came hours before Canada was expected to announce retaliatory tariffs on some $2.7 billion in U.S. aluminum products. Unwrought aluminum imports from Canada for the rest of the year are set to decline “sharply from the surges experienced earlier in the year,” the U.S. Trade Representative (USTR) said in a statement.

American business groups and aluminum manufacturers criticized the August tariffs for causing uncertainty and raising prices. The governors of Maine, New Hampshire and Vermont bemoaned the costs in a letter to Mr. Trump last week. “The impact of the tariffs will reduce competitiveness of aluminum-consuming industries and ripple throughout New England supply chains of manufacturing and technical production,” they wrote. Mr. Trump is hoping to win New Hampshire. The tariff reprieve spares manufacturers and consumers for now. But Mr. Trump could reimpose them in a second term. USTR warned that if Canada exceeds 105% of certain “expected” shipment levels—levels still well below those of last year—the U.S. could reinstate the tariffs. According to USTR, the earliest the U.S. could reimpose tariffs is “six weeks after the end” of September, which rules out new tariffs before Election Day. It's nice to see that the Trump Administration realizes that tariffs aren’t political winners. If only the President would stop thinking of them as his household economic remedy.

Read original article on Wall Street Journal.

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