As Tariffs Loom, PPAI Pushes Back Against 'Harmful' Legislation

President Trump’s plan to implement new and escalated tariffs against China and the European Union is close to reality, as White House officials said that he plans to announce tariffs against China tomorrow, to penalize the country for intellectual property theft.

The package of tariffs, estimated to be about $60 billion in total, is part of Trump’s plan to combat a trade deficit and create more U.S. jobs.

However, the plan has been met with criticism from foreign entities that believe it would destabilize international trade, if not start an all-out trade war, which the president has hinted at himself in a tweet: claiming they are “good” and “easy to win.”

When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!

— Donald J. Trump (@realDonaldTrump) March 2, 2018

In addition to the plans provoking the ire of governments and economists, promotional products professionals have voiced their concern over the president's perceived zeal for imposing new trade legislation to punish those whom he believes has caused trade woes for the U.S.

In a statement yesterday, PPAI announced its inclusion in the coalition of 45 associations and trade groups opposed to the potential tariffs, which would impact items in the industry such as apparel basics and footwear.

In a letter to the president, the coalition members outlined their concerns that the tariffs “would trigger a chain reaction of negative consequences for the U.S. economy, provoking retaliation; stifling U.S. agriculture, goods and services exports; and raising costs for businesses and consumers.”

The letter started with a disclaimer of sorts, where the coalition expressed its problems with China’s trade policies and practices, but noted that the proposed tariffs on electronics and apparel would be particularly harmful to U.S. markets.

“Tariffs on electronics, apparel and other consumer products would increase prices for U.S. consumers and businesses, while doing little to address the fundamental challenges posed by unfair and discriminatory Chinese trade practices,” it said. “These increased costs would effectively levy a tax on U.S. consumers and businesses, negating gains for American workers from U.S. tax reform.”

In addition to PPAI, the coalition included several groups related to the industry overall, like the American Apparel & Footwear Association; Fashion Accessory Shippers; Outdoor Industry Association; Sports and Fitness Industry; U.S. Fashion Industry Association; and U.S. Hide, Skin and Leather Association.

“PPAI and the promotional products industry urge the administration not to impose tariffs, but rather work with the business community to find an effective but measured solution to China’s protectionist trade policies and practices that will protect American jobs and competitiveness,” PPAI said in the statement. “Consistent with Section 304 of the Trade Act of 1974, we request that the administration allow industry experts the opportunity to comment on these issues, including the economic impact of any potential actions.”

PPAI also urged members to contact their representatives in Congress and urge them to oppose the tariffs.

According to CNBC, President Trump will be briefed again in two weeks to consider more actions, assuming he goes through with his planned announcement tomorrow.

The discussed $60 billion sum could be held in contention, however, because the law dictates that penalties are limited to the amount of harm the U.S. Trade Representative finds the trade practices in question have done to the U.S economy. Trade Representative Robert Lighthizer said on Wednesday that Trump will make the final decision, but that the administration plans to “inflict maximum harm upon China and try to limit the effect on U.S. consumers.”

The climate of protectionist policies has also startled the U.S.’s European counterparts in the E.U., as its leaders say all trade policies must apply to all member states. European leaders brought up these points at the G-20 summit in Buenos Aires, Argentina, this week.

Echoing the president’s sentiment on the possibility of hostile trade policies, U.S. Treasury Secretary Steven Mnuchin said that the administration is not swayed by European leaders’ concerns over negotiations collapsing.

“This administration is going to make sure that we’re treated fairly,” Mnuchin told the New York Times yesterday. He added that he understood concern from Canadian leaders that the U.S. was dragging its feet on NAFTA, too, and conceded, “… we’re going to have to rethink some of the rules.”

Mnuchin summed up his position up in a press conference, saying, "This is not about protectionism, but it's about fair and free reciprocal trade."