Experts Disagree on Whether Lobbying Against Section 301 Tariffs Will Ebb
Two and a half years after the first Section 301 tariffs went on what ultimately covered the vast majority of imports from China, most of the public lobbying is about renewing exclusions, or offering another round of exclusion applications to be submitted. Lawyers and advocates differ on how they think lobbying will develop over the course of 2021, as President Joe Biden gets his trade team in place. Dan Ujczo, senior counsel at Thompson Hine, said he thinks the focus on exclusions is because businesses have gotten the message on 301s from the administration, which he described as: “brace for these to be around. These aren’t going away anytime soon.”
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Nicole Bivens Collinson, head of the international trade and government relations practice at Sandler Travis, agreed with that, and said that's also why all the questions during the Senate Finance Committee hearing on the tariffs were around exclusions. Even in the written questions, only two explicitly asked if some tranches might be removed, with far more focused on exclusions.
Bivens Collinson said a lot of members of Congress are not going to ask for the tariffs' removal “in such a public manner.”
Ujczo said just because there haven't been hints that any of the tariffs could be lifted, “that does not mean companies should not be advocating for the removal of the tariffs.”
He doesn't think the government can do it without concessions from the Chinese, however. “You can’t just pull them [the tariffs] back now. You cannot pull those back and get nothing,” Ujczo said. “You’ve lost all credibility at that point.”
Given this political situation, he thinks the lobbying effort is going to be around exclusions for the medium term. But, he predicted, even getting exclusions to return “is going to be a heavy lift institutionally.”
Bivens Collinson said companies are going to be looking at ways to save money because of the pandemic, so she thinks companies that buy Chinese imports will want the tariffs to go away. “In my opinion, if you want to stimulate businesses, think about removing tariffs,” she said.
Ujczo predicts there is going to be a split in the business community, with companies that have already changed their supply chains so that their imports are not subject to the tariffs not just declining to ask for their removal, but actively lobbying for them to stay. “Tariffs become a bit of a self-licking ice cream cone,” he said. “Some of the companies that a few years ago wanted these things removed; they’re going to be forceful advocates for keeping those tariffs.” He said for some companies he works with, the worst thing for them would be if the tariffs went away, since they now have a competitive advantage.
Bivens Collinson disagrees. She doesn't think companies who have moved supply chains will argue against the end of tariffs. But, she said, the shift out of China may not be over. “I think some companies are looking at what’s going on in China vis a vis the Uighur people,” she said. “We have a lot of consumers who are very concerned about the conditions under which their goods are produced.” If it becomes clear that the Biden administration is going to continue the tariffs, “then slowly more will move,” she said.