The Commerce Department’s report on its Section 232 investigation into steel imports has been deemed insufficient due to Defense Department objections and other concerns, sources told Inside U.S. Trade, delaying its release and any action the president might take to shore up the U.S. industry.
[ Isabelle Hoagland | December 8, 2017 | Inside US Trade]
Commerce Secretary Wilbur Ross has publicly said the investigation has been put on the shelf while tax reform — the administration’s top legislative priority — is hashed out on Capitol Hill. He told lawmakers this week the investigation would be completed “very soon.”
But sources said a draft of the report pitched to the Defense Department earlier this year was shot down because of concerns that trade restrictions suggested by Ross would unnecessarily vex U.S. allies. Under the 1962 Trade Expansion Act, Ross is required to consult with the Defense Department on “methodological and policy questions that arise during a Section 232 investigation.”
National security concerns continue to affect the investigation, sources said.
“The administration has politically boxed themselves in with this [Section 232] report because [the Defense Department] really won’t let it go through,” a defense industry consultant told Inside U.S. Trade. The “only way” Defense Secretary James Mattis will agree to any trade restrictions Commerce suggests is if there are significant carveouts for U.S. allies, the source said.
Inside U.S. Trade has learned remedy exclusions are being considered for Australia, Mexico, Canada, the United Kingdom, Japan and South Korea. A source said that those countries “had received varying levels of assurances” that they would not be impacted in the 232 investigation.