March 5, 2019 11:39AM

Any Excuse to Raise Tariffs

The Trump administration seems to be looking for every possible excuse to raise tariffs. Early on it intensified the use of anti-dumping/countervailing duties and safeguard measures, which are the built-in protectionism that every administration uses. Then it dusted off some old statutes that had fallen into disuse: Section 232 (national security) to impose tariffs on steel and aluminum from around the world; and Section 301 (used to address unfair trade practices abroad) to impose tariffs on hundreds of billions of dollars of Chinese imports. And now it has a new idea for tariff increases: ending the duty-free access given to imports from some developing countries through the Generalized System of Preferences (GSP) program, and charging normal tariffs instead. Yesterday, the U.S. Trade Representative's Office made the following announcement:

At the direction of President Donald J. Trump, U.S. Trade Representative Robert Lighthizer announced today that the United States intends to terminate India’s and Turkey’s designations as beneficiary developing countries under the Generalized System of Preferences (GSP) program because they no longer comply with the statutory eligibility criteria. 

India’s termination from GSP follows its failure to provide the United States with assurances that it will provide equitable and reasonable access to its markets in numerous sectors.  Turkey’s termination from GSP follows a finding that it is sufficiently economically developed and should no longer benefit from preferential market access to the United States market.

By statute, these changes may not take effect until at least 60 days after the notifications to Congress and the governments of India and Turkey, and will be enacted by a Presidential Proclamation.

My old colleague Sallie James wrote about the GSP program many years ago. The program is definitely flawed, and she called for some sensible reforms. But rather than reforming the program, it seems like the Trump administration is simply looking for opportunities to raise tariffs.