WASHINGTON ― If President-elect Donald Trump thinks he’s going to impose a 35 percent tariff on companies importing goods, he might want to check with Republicans in Congress.
House Majority Leader Kevin McCarthy (R-Calif.) suggested Monday that Republicans would not be in favor of imposing the 35 percent tariff on foreign goods that Trump proposed Sunday in a series of tweets.
Trump may not understand how tariffs really work ― it would be very difficult for the United States to impose them on specific companies that move jobs to a foreign country ― or that Congress, not the president, sets them. But he also might be trying to use trade complexities to end run around Congress.
The president’s administration could declare a given country in violation of certain trade acts, and then impose a retaliatory tariff. It would then be up to the other nation to lodge protest with the appropriate authority.
If Trump wanted to push the issue, he probably could impose a tariff and wait for Congress, the courts or a trade organization to do something about it. And if he truly wants to do it, Republicans could be the ones going after Trump.
“I don’t want to get into some sort of trade war,” McCarthy said, still downplaying the policy differences between Trump and congressional Republicans.
There is some debate about how much power the president has to enact tariffs and “rip up” trade deals. The president could declare the United States in violation of certain trade acts, and then try to impose a tariff based on those old laws, but there would be significant pushback from Congress.
Regardless, the majority leader said Republicans were intent on overhauling the corporate tax code so that businesses would stay in the United States. “That’s the best way to solve this problem,” McCarthy said.
But he also made it clear that he doesn’t believe high tariffs are the best way to keep or create jobs in the United States.
“I think history has taught us that trade wars are not healthy,” he said.
McCarthy stressed that Trump had run on reforming the corporate tax code, and that Republicans were in support of that idea. Pressed whether Republicans would give a tariff bill a vote if Trump pushed for it, McCarthy danced around answering directly ― “that’s a hypothetical question” ― but indicated again that overhauling the tax code was Republicans’ preferred path.
“The answer would be that we’re going to have tax reform,” he said.
He added that tax reform was a better way of keeping jobs “than digging into a trade war.”
