Mara Lee

House Speaker Paul Ryan expressed skepticism that there's a veto-proof majority aligned to pass a bill constricting the president's authority to levy tariffs. "You'd have to pass a law he would want to sign into law. You can do the math on that," he said at a press conference at the Capitol on June 6.

The European Union requested consultations with the U.S., to hash out whether Europe has resolved the issues with Airbus subsidies, as it claimed on May 17. The EU lost the case on state financing for plane model launches back in 2011, but the World Trade Organization legal process has been continuing since then on whether the illegal practices have been fully abandoned. The U.S. first brought the case in 2004. On May 15, a WTO appellate body said the EU had partly complied with its obligations, but still had some changes to make (see 1805150066).

Businesses that rely on steel are being whipsawed by the shifting parameters of 25 percent tariffs, and some have been waiting two months to find out if any of what they import will be spared. None of the thousands of product exclusion requests have been accepted or rejected so far by the Commerce Department's Bureau of Industry and Security.

With Mexico and Canada balking at U.S. demands in NAFTA negotiations, President Donald Trump is contemplating replacing the deal with two bilateral agreements with Mexico and Canada, an administration official said June 5. The comment from Larry Kudlow, the president's chief economic adviser, followed a remark from Trump on June 1 that separate deals make sense "because you're talking about a very different two countries."

Sen. Bob Corker, a Republican Trump critic from Tennessee who is retiring at the end of the year, told reporters in the Capitol June 5 that he will be introducing a bill that would not allow the president to implement tariffs or quotas based on national security concerns without congressional approval. That authority was given to the executive branch in 1962. According to a source familiar with the bill, if passed, it would require the president to submit to Congress actions under Section 232 of the Trade Expansion Act of 1962. "For a 60-day period following submission, legislation to approve the proposal will qualify for expedited consideration, guaranteeing the opportunity for both debate and a vote." This would give Congress an opportunity to veto tariffs on autos and auto parts -- an investigation under Section 232 recently began (see 1805240002). The bill would also apply to the administration's steel and aluminum tariffs and quotas, the source said.

Chinese pledges to buy more U.S. agricultural products and natural gas (see 1805200002) are still on the table, but China said that if Section 301 tariffs are levied, these purchases will not happen. On June 4, the White House issued a summary of the talks between the Chinese and a delegation led by Commerce Secretary Wilbur Ross that happened in Beijing the previous two days. "The meetings focused on reducing the United States’ trade deficit by facilitating the supply of agricultural and energy products to meet China’s growing consumption needs, which will help support growth and employment in the United States," the statement said.

Canada requested a Chapter 20 panel under NAFTA to dispute the imposition of steel and aluminum tariffs, Foreign Affairs Minister Chrystia Freeland announced June 1. That's in addition to filing a complaint at the World Trade Organization. Canada says the U.S. is violating international trade obligations with its "improper use of national security pretexts for protectionist purposes." "Canada will closely collaborate with the European Union, which also filed a WTO challenge...." she said. She also noted that U.S. law designates Canada as part of the military industrial base. Earlier, Canada issued its list of goods that will face retaliatory tariffs (see 1806010022), which included appliances, mattresses, maple syrup, condiments and candy, in addition to aluminum and steel goods.

A Republican senator who opposed Donald Trump during the primary campaign and the Senate minority leader both reacted to New York Times reporting that the administration will roll back the seven-year export ban on Chinese telecommunications equipment giant ZTE. Sen. Marco Rubio, R-Fla., tweeted a link to the story, and said it is a great deal for China. China "crushes U.S. companies with no mercy & they use these telecomm companies to spy & steal from us. Many hoped this time would be different. Now Congress will need to act," he said.

Consultations at the World Trade Organization have failed to resolve trade barriers to U.S. wine in British Columbia grocery stores, so the U.S. has asked for a dispute settlement panel to take up the issue, the U.S. announced on May 25. Consultations started last October. The issue is the stores require that imported wine be stocked in a separate building from the main store (see 1701180083). The news release announcing the panel request said that as far as the U.S. has been able to learn, no stores have made the investment to sell imported wines. American wines are still sold at liquor stores, which used to be the only place to buy wine in the province.

Appropriations bills for fiscal year 2019 that are moving through both chambers of Congress ignored the president's suggestion to cut the Harbor Maintenance Tax (see 1802150028), and aim to dedicate more funding for dredging, locks maintenance and jetty maintenance. The tax is currently $0.125 per $100 of cargo value. In the current fiscal year, the government is spending $1.4 billion out of the Harbor Maintenance Trust Fund. The House appropriations bill recommends increasing that to $1.6 billion; the Senate version recommends $1.53 billion. Steve Fisher, executive director of the American Great Lakes Ports Association, said, "$130 million more, that's quite a bit."