U.S. Department of Commerce Initiates Section 232 Investigation into Auto Imports

 

Today, following a conversation with President Donald J. Trump,  U.S. Secretary of Commerce Wilbur Ross initiated an investigation under Section 232 of the Trade Expansion Act of 1962, as amended.  The investigation will determine whether imports of automobiles, including SUVs, vans and light trucks, and automotive parts into the United States threaten to impair the national security as defined in Section 232.  Secretary Ross sent a letter to Secretary of Defense James Mattis informing him of the investigation.

“There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry,” said Secretary Ross. “The Department of Commerce will conduct a thorough, fair, and transparent investigation into whether such imports are weakening our internal economy and may impair the national security.”

During the past 20 years, imports of passenger vehicles have grown from 32 percent of cars sold in the United States to 48 percent.   From 1990 to 2017, employment in motor vehicle production declined by 22 percent, even though Americans are continuing to purchase automobiles at record levels.  Now, American owned vehicle manufacturers in the United States account for only 20 percent of global research and development in the automobile sector, and American auto part manufacturers account for only 7 percent in that industry.

Automobile manufacturing has long been a significant source of American technological innovation. This investigation will consider whether the decline of domestic automobile and automotive parts production threatens to weaken the internal economy of the United States, including by potentially reducing research, development, and jobs for skilled workers in connected vehicle systems, autonomous vehicles, fuel cells, electric motors and storage, advanced manufacturing processes, and other cutting-edge technologies.

Following today’s announcement, the Department of Commerce will investigate these and other issues to determine whether imports of automobiles and automotive parts threaten to impair the national security.  A notice will be published shortly in the Federal Register announcing a hearing date and inviting comment from industry and the public to assist in the investigation.

Minority Business Development Agency Celebrates Asian Pacific American Heritage Month

WASHINGTON, D.C. — The U.S. Department of Commerce’s Minority Business Development Agency (MBDA) celebrated Asian Pacific American Heritage Month (APAHM) with a day-long celebration Tuesday, May 15 featuring remarks from White House officials, panels focused on supplier partnerships and procurement, as well as discussions on the successes and challenges for millennial Asian American and Pacific Islanders (AAPI).

Karen Dunn Kelley, Under Secretary for Economic Affairs, performing the nonexclusive duties and functions of the Deputy Secretary of Commerce, delivered a keynote address at the 2018 National AAPI Business Summit that discussed the many contributions AAPI-owned businesses have made to the U.S. economy. Kelley noted that from 2007 to 2012, Asian-owned businesses in the U.S. increased 24 percent, while the number of Native Hawaiian and Pacific Islander-owned businesses expanded 45 percent.

“Secretary Ross and this administration believe minority-owned businesses play an important role in communities and in creating jobs and growth in the American economy,” Under Secretary Kelley said.

Under Secretary Kelley also highlighted two standout Asian-owned businesses supported by local MBDA business centers: Leasa Industries, a Miami-based bean sprout and tofu company, and Mellish Island, a sea cucumber processor and exporter to China with a U.S. headquarters in San Dimas, California.

After remarks from Holly Ham, Executive Director for the White House Initiative on Asian Americans and Pacific Islanders, and Mercedes Schlapp, Assistant to the President and Senior Advisor for Strategic Communication, MBDA National Acting Director Edith McCloud joined Ham on stage to sign a Memorandum of Understanding (MOU) to support and advocate for AAPI-owned businesses.

Two of the most notable Asian Americans serving in U.S. government also gave remarks at the National AAPI Business Summit: Elaine L. Chao, the U.S. Secretary of Transportation, and the highest-ranking Asian American cabinet member, and Congresswoman Judy Chu (CA-27), Chair for the Congressional Asian Pacific American Caucus.

MBDA closed out the National AAPI Business Summit with a celebration by celebrity Asian chefs. The aroma of Chinese, Filipino and Indonesian cuisine filled the air, as the Department of Commerce lobby transformed into a bustling food court. Chef Widjiono (Yono) Purnomo of Yono’s Restaurant in Albany, New York, Chefs Michael Chen and Rusong Dai of New China Taste in Alexandria, Virginia, and Chef Patrice Cleary of Purple Patch in Washington D.C., prepared sample dishes for attendees, showcasing a variety of Asian dishes.

From left to right: George Mui, MBDA, Chef Widjiono (Yono) Purnomo, Chef Patrice Cleary of Purple Patch, Jan-Ie Low, Golden Catalyst, LLC and Celebrity Chef event organizer, Chef Michael Chen and Chef Rusong Dai of New China Taste.

NORWAY NATIONAL DAY

On behalf of the Government of the United States of America, I extend my warmest congratulations to all Norwegians on your 204th anniversary of Constitution Day.

Norway is one of the United States’ strongest partners and Allies. We admire your leadership in NATO, the UN, and in the Arctic Council. Your support across many fields, including energy development and coalition efforts to defeat ISIS, are invaluable. Millions of Americans can trace their roots back to Norway and the connections between our people continue to grow as over 4,000 Norwegians are alumni of U.S.-sponsored exchange programs. It is because of these ties that the United States and Norway continue to uphold a deep commitment to transatlantic unity and our shared democratic values.

To all Norwegians, Gratulerer med dagen. As you celebrate with children’s parades and wave your flags with pride this May 17th, I offer you my very best wishes on this Constitution Day and in the coming year.

Mike Pompeo
Secretary of State
Washington, DC

Net Neutrality Needs Bipartisan Legislation, Not More Political Theater

BY U.S. Senator John Thune

I support net neutrality. I support rules that prevent blocking, throttling, and paid prioritization of internet traffic. I believe these principles should guide us on Capitol Hill as we work to expand broadband access to even the most remote and rural areas of the country.

You might be surprised to learn that most of my fellow senators believe this too.

Unfortunately, manufactured controversy often gets more attention in Washington than real solutions. We have seen this in recent months as some in Congress and outside groups have shaped an ominous narrative surrounding the way we regulate the internet.

The internet is too important for partisan politics. Congress must codify widely accepted net neutrality protections through bipartisan legislation.

Instead of crafting forward-looking solutions that protect internet users and promote innovation, however, Congress will spend time on more political theater.

Rather than voting for 21st Century rules to protect the internet, we’ll be taking a show vote on whether to look backwards and re-apply rules meant for the old Ma’ Bell phone system to the modern internet.

This is a mistake, and only delays concrete protections for a free and open internet.

The misguided decision to apply regulations created in 1934 for voice telephone services to the internet—adopted on a party-line vote by the Federal Communications Commission (FCC) in 2015—has, according to the FCC, slowed investment, preventing the improvement and expansion of services to the 39 million Americans living in rural parts of the country.

The uncertainty in the future of regulation, caused by the ever-shifting political winds, means investments to connect more Americans in states like South Dakota are likely to remain stagnant.

It doesn’t have to be this way. For years, I have called for bipartisan legislation—by elected representatives, not unelected bureaucrats at the FCC—that would permanently ban blocking, throttling, and paid prioritization by broadband internet providers.

The new leadership of the FCC has given us an opportunity to do just that, by freeing the internet from outdated, monopoly-era regulations.

If the Democrats are serious about long-term protections for consumers, they should look ahead towards a bipartisan solution, rather than looking backwards and trying to reverse the current FCC’s Restoring Internet Freedom Order.

Claims that this order would mean slower internet speeds have already been rebutted in a recent independent fact check.

The bottom line is, Congress should be spending time on a permanent solution that is not subject to Washington power shakeups—one that will spur all communities into the 21st Century and encourage a new wave of American innovation and competitiveness.

Regardless of how the Senate votes this month, the Congressional Review Act (CRA) effort will not provide Americans with lasting protections for the internet. If anything, the tempest over the CRA has stalled conversations among legislators on both sides of the aisle who have demonstrated eagerness to come together and find a bipartisan solution.

Once the latest showdown is over, we should set aside the fear mongering and manufactured hand-wringing and get to work on a solution that ends this debate and protects the economic engine of the internet for generations of Americans to come.

BOYCOTT CHINA TO AVOID A TRADE WAR ?

File 20180503 138586 1kwi1o7.jpg?ixlib=rb 1.1
China hopes to make more microprocessor chips in China, which makes it a great industry to lead a boycott. AP Photo

Amitrajeet A. Batabyal
Rochester Institute of Technology

The U.S. and China are locked in negotiations both sides say they hope will avert a painful trade war.

The Trump administration has threatened to impose a series of tariffs unless China agrees to limit what he calls “its illicit trade practices.” The Chinese government, for its part, appears unwilling to accede to his demands and has offered some retaliatory trade sanctions of its own.

The ostensible reason President Donald Trump is willing to risk a trade war is because he argues – justifiably – that U.S. companies have been taken advantage of by their Chinese counterparts for decades, required to hand over lucrative intellectual property in exchange for access to China’s growing middle class.

Tariffs, however, aren’t the answer to that problem, as my research in international economics and the design of international environmental agreements shows. Rather, if Trump really wants to achieve his stated aims, he should put American businesses on the front lines of his strategy and call for a boycott of China.

Doing business in China

If that sounds preposterous, consider the origins of this escalating conflict.

Its seeds can be traced back to the opening up of the Chinese economy as a result of reforms introduced by Deng Xiaoping in 1978 and the zeal of American – and more generally Western – companies in taking full advantage of new business opportunities in this gigantic market.

However, in many instances in the past four decades, the presence of mandatory technology transfer policies and foreign ownership restrictions have meant that market access has been granted only to Western firms willing to play ball. In addition, there is now considerable evidence that Chinese businesses, often with the participation of government officials, have been conducting cyberattacks on American companies to steal their intellectual property.

The Trump administration estimated that this theft of American intellectual property costs US$225 billion to $600 billion annually.

And since companies are already on the front lines of this fight, with the most to lose, it makes sense that they’re the ones to lead the counter attack.

A boycott by firms

So how would a boycott work? Importantly, the U.S. couldn’t do it alone.

American companies, like everyone else, want to make money in the one billion person market that is China and hence it would not make sense for them to unilaterally withdraw. By doing so, they would be giving up valuable market share to their rivals. For example, if a top U.S. luxury car seller such as Cadillac were to unilaterally boycott the Chinese market, then it would be giving up valuable market share to other rivals.

The key point is that many of those rivals are in Europe and have also been used and abused by Chinese companies and hence have a similar interest in finding a way to prevent them from stealing any more of their intellectual property.

If all Western luxury car makers jointly boycotted China, then this would be equivalent to acting as if a Chinese market didn’t exist. Clearly, profits would take a hit in the short run, but the long-term objective of ensuring that Western companies do business on a level playing field would be met.

Cars and chips

Also, a boycott wouldn’t have to involve more than a few industries to be effective. Specifically, the focus would need to be on industries that China, through its Made in China 2025 scheme, would like to dominate. Two strong examples are cars and computer chips.

China has been trying to develop a domestic automobile industry since the early 1980s, an effort that has largely failed. But now, under the Made in China initiative, it is seeking to become a leader in electric vehicles.

However, it needs Western automakers to continue to operate in China and conduct research on battery technology and on electric vehicles in order to achieve this goal.

Thus if Western car companies and particularly those actively conducting research in battery technology jointly agreed to stop competing in China, that would send a strong message to Beijing. Either China could try to go it alone with no Western collaboration or it’ll have to realize that systematically strong-arming companies will not help it attain its goals.

A second example of an industry in which a Western boycott would be effective is microprocessor chips. This is because China is still significantly dependent on imports despite operating a few notable supercomputers that use solely home-made chips. Almost 90 percent of chips used in China are either imported or produced domestically by foreign companies, so a boycott would force the government to sit up and take notice.

For a boycott of this sort to work, it is important that American officials not attempt to go it alone, making it seem like a purely China versus U.S. spat. Successful boycotts follow a “strength in numbers” logic.

And this is where the Trump administration enters the fray. It could use its diplomatic muscle to enlist the governments of like-minded allies – particularly the European Union – to get their companies in key industries to join the American-led boycott. This could be part of a wider effort to credibly and collaboratively communicate to China that it needs to play fairly. As New York Times columnist Thomas Friedman recently noted, the “last thing Beijing wants is a U.S.-E.U. united front demanding it play fair.”

Not only would this selective boycott make it harder for the Chinese government to achieve its Made in China 2025 dreams, it would also anger consumers, who are increasingly hungry for Western goods – something the leadership is well aware of.

And in contrast to tariffs, such a campaign would likely have no adverse impact on American consumers.

One important caveat: This course of action, like imposing tariffs, would probably do little to reduce the threat of intellectual property theft by Chinese hackers.

The Chinese government is hoping to make more high-tech products in China by 2025. AP Photo/Ng Han Guan

Would a boycott work?

When we think of a boycott, we usually imagine consumers avoiding a particular product. Such boycotts have had varying levels of success.

A corporate boycott of a nation is much less common. To the best of my knowledge, a corporate boycott of a nation along the lines suggested here has not been attempted before. Historically, boycotts against a nation have typically been designed to persuade consumers to not purchase products from a nation, such as the anti-apartheid movement or the more controversial boycott of Israel.

What I am proposing is a country boycott by companies located in multiple nations and hence it is not possible to directly gauge the likelihood of success based on past actions

That being said, vigorous diplomacy by like-minded nations sharing a common objective has yielded positive outcomes in as diverse and difficult cases as the 1987 Montreal protocol to reduce ozone-depleting substances and the 2015 Iran nuclear deal. Similarly, the Organization of Petroleum Exporting Countries cartel has demonstrated how businesses across nations can take joint action to achieve a common objective, with mixed success.

Might China retaliate? Perhaps, but the costs would be high if the U.S. were to successfully organize a boycott involving companies in several dozen countries. More likely, it would find accommodation a much more palatable option in the face of a united front.

The ConversationThe recent tariffs aside, Western businesses and nations need to stop treating China with kid gloves, which I believe they have been doing for years. A boycott would be a good start – and wouldn’t risk a trade war.

Amitrajeet A. Batabyal, Arthur J. Gosnell Professor of Economics, Rochester Institute of Technology

This article was originally published on The Conversation.

Remarks With Israeli Prime Minister Benjamin Netanyahu After Their Meeting in Tel Aviv, Israel

04/29/2018
Tel Aviv, Israel

PRIME MINISTER NETANYAHU: Good afternoon. Secretary Pompeo, Mike, it’s wonderful to welcome you. This is your first visit to Israel as Secretary of State. I think it’s significant that you chose, as did the President, to include Israel on this important itinerary. I think it’s symbolic of our friendship, which is deep, and getting even deeper and stronger. We’ve known each other for some time, I followed your activities in Congress and then as CIA, now as Secretary of State. You’re a true friend of Israel, a true friend of the Jewish people, and I look forward to working with you in your new role. We’ve just had very productive, very focused conversations on our common interests and how to defend our common value.

I want to thank again President Trump for his historic decision on recognizing Jerusalem as Israel’s capital. We look forward to welcoming the American delegation to celebrate the relocation of the embassy with you, Ambassador Friedman. I must tell you that the bold decision by President Trump has prompted other countries – there are quite a few now who are planning to move their embassy to Jerusalem as well. It says something about American leadership and about the forthright way in which simple truths are being put forward and the effect this has on the international scene.

Mr. Secretary, I think the greatest threat to the world and to our two countries and to all countries is the marriage of militant Islam with nuclear weapons, and specifically, the attempt of Iran to acquire nuclear weapons. We’ve had a very productive talk today on this subject as well. I appreciate the President’s leadership and your position on stopping Iran from ever acquiring nuclear weapons. I appreciate the President’s and your position on stopping Iran’s aggression in the region. That aggression has grown many-fold since the signing of the Iranian deal. If people thought that Iran’s aggression would be moderated as a result of signing the deal, the opposite has happened, and Iran is trying to gobble up one country after the other. Iran must be stopped. Its quest for nuclear bombs must be stopped. Its aggression must be stopped. And we’re committed to stopping it together.

I was very much encouraged, once again, by the steadfast support of the United States for Israel and for this common effort, which encompasses many other countries, as you know – as you well know, Mr. Secretary. But our bond is special. It’s based on shared values of democracy, freedom, the quest for security and peace, and I can say that today America and Israel are closer than ever before. And I have no doubt that our alliance will grow even closer in the years ahead.

So I want to welcome you back to Israel, Mr. Secretary. It’s a pleasure to see you and I wish you the best of luck in your important mission. Thank you.

SECRETARY POMPEO: Thank you. Thank you so much. Thank you.

Well, good afternoon. It is a great honor to be here on my first trip as Secretary of State. I’ve been the Secretary for a handful of hours. As I was saying earlier, I haven’t been to my office yet.

As you said, this relationship’s never been stronger, and I think we should both be proud of that. We had fantastic conversations today on difficult issues facing each of us. We are incredibly proud to be opening the new embassy on May 14th, well ahead of the original timetable. This step comes as Israel celebrates its 70th anniversary of independence and 70 years of recognition as steadfast support for Israel from the American people as well. By recognizing Jerusalem as the capital of Israel and the seat of its government, we’re recognizing reality. I also stress, as President Trump has said in December, the boundaries of Israeli sovereignty in Jerusalem remain subject to negotiations between the parties, and we remain committed to achieving a lasting and comprehensive peace that offers a brighter future for both Israel and the Palestinians.

Many of our conversations today, Mr. Prime Minister, as you said, centered on Iran. Strong cooperation with close allies like you is critical to our efforts to counter Iran’s destabilizing and malign activity throughout the Middle East and indeed throughout the world. We remain deeply concerned about Iran’s dangerous escalation of threats to Israel and the region, and Iran’s ambition to dominate the Middle East remains. The United States is with Israel in this fight and we strongly support Israel’s sovereign right to defend itself.

Regarding the JCPOA, President Trump’s been pretty clear. This deal is very flawed. He’s directed the administration to try and fix it, and if we can’t fix it, he’s going to withdraw from the deal. It’s pretty straightforward. Unlike the past administration, President Trump has a comprehensive Iran strategy that is designed to counter the full array of threats emanating from Tehran.

As part of the President’s comprehensive Iran strategy, we are also working to counter the broad set of non-nuclear threats: Iran’s missile systems, its support for Hizballah, the importation of thousands of proxy fighters into Syria, and its assistance to the Houthi rebels in Yemen. We look forward to working closely with strong allies like Israel in countering these threats and rolling back the full range of Iranian malign influence.

Regarding Syria, where the barbaric Assad regime is propped up by Iran, the United States’ top priorities are to defeat ISIS, de-escalate violence, deter the use of chemical weapons, and ensure the safe delivery of humanitarian aid and support an ultimate political resolution to the conflict. Our strategy to do that remains unchanged. We strongly support the UN-led efforts in Geneva to bring an end to the Syrian conflict, which has gone on for far too long.

We know there are many challenges ahead and we look forward to being your partner in resolving each of them. The United States and Israel I know together can achieve that. It’s great to be back.

PRIME MINISTER NETANYAHU: Thank you.

Library of Congress and Bibliothèque Nationale de France Announce Collaboration on International Digital Content

Librarian of Congress Carla Hayden and Laurence Engel, president of the Bibliothèque National de France (BnF), today announced a collaboration between the Library of Congress and the BnF to provide digital content for a new online space for collections relating to shared French-American history. The initiative will also be supported by other U.S. organizations, including the National Archives.

During the special visit to the Library, President Macron and his wife, Brigitte, viewed a display that included treasures from the Library of Congress and National Archives that will be part of the international collaboration, which highlights an extensive tradition of close cooperation between the United States and France.

Through direct digital access to complete books, maps, prints and other documents from the collections of the partner libraries, the new bilingual website will focus on the cultural and historical connections between France and Northern America and, more specifically, the United States during the 16th through the 19thcenturies.

This digital space, which revitalizes a previous initiative called “France in America,” is part of the missions of the Library of Congress and the Bibliothèque Nationale de France to make their resources available to ever-growing audiences and to preserve a universal collection of knowledge and creativity for future generations.

“The Library of Congress is thrilled to continue these mutual efforts with the National Library of France to collect, preserve and provide access to the rich cultural heritage of France and French-Americans,” said Hayden. “Together we have a substantial collection of materials reflecting the deep historical and cultural connections between France and the United States, as well as materials documenting and celebrating French-American life.”

“Since the epic story of the New France, our two nations share also a common history,” said Engel. “The future website, a joint initiative of the Library of Congress and the National Library of France, will associate prestigious American institutions such as the National Archives to bring it to life for the benefit of all.”

“The National Archives is honored to be celebrating the important historical ties between our countries by sharing our unique French-American documents in this exciting international venture,” said Archivist of the United States David S. Ferriero.

As a key part of this collaboration, Bibliothèque Nationale de France will create and host the website, which is part of its collection “Shared Heritage,” while the Library of Congress will select and make available high-quality digital scans of relevant materials from its collections.

The Library of Congress is the world’s largest library, offering access to the creative record of the United States—and extensive materials from around the world—both on-site and online. It is the main research arm of the U.S. Congress and the home of the U.S. Copyright Office. Explore collections, reference services and other programs and plan a visit at loc.gov; access the official site for U.S. federal legislative information at congress.gov; and register creative works of authorship at copyright.gov.

The Bibliothèque Nationale de France is one of the oldest national libraries in the world tracing its origins back to a medieval royal collection and benefiting from one of the earliest legislation regarding Legal Deposit, promulgated as soon as 1537. Its collections are global and as such reflect France’s position in the world across the centuries, the humanist tradition and the Enlightenment. Visit collections, reference services and other programs and plan a visit at www.bnf.fr as well as discover Gallica, the digital library, at gallica.bnf.fr.

The National Archives serves American democracy by safeguarding and preserving the records of our government, so people can discover, use and learn from this documentary heritage.  From the Declaration of Independence to accounts of ordinary Americans, the holdings of the National Archives directly touch the lives of millions of people. The National Archives carries out its mission through a nationwide network of archives, records centers and Presidential Libraries, and online at www.archives.gov.

ON THE OCCASION OF THE REPUBLIC OF TOGO’S NATIONAL DAY

On behalf of the American people, I am extending warm wishes to the people of Togo as you celebrate the 58th anniversary of your independence on April 27.

The United States remains committed to a strong partnership with Togo and to supporting Togo’s efforts to strengthen its democracy, prosperity, and security.

As you celebrate this historic day, the United States stands with Togo in honoring your independence as a nation rich in tradition and full of possibilities, and sends warm wishes to the government and people of Togo for a joyous independence celebration.

Mike Pompeo
Secretary of State
Washington, DC

Commemorating the Birthday of the Disappeared Panchen Lama, Gedhun Choekyi Nyim

On April 25, we marked the birthday of the 11th Panchen Lama, Gedhun Choekyi Nyima, who has not appeared in public since he was reportedly abducted two decades ago by the Chinese government at age six. The United States remains concerned that Chinese authorities continue to take steps to eliminate the religious, linguistic, and cultural identity of Tibetans, including their ongoing destruction of communities of worship, such as the Larung Gar and Yachen Gar monasteries. We call on China to release Gedhun Choekyi Nyima immediately and to uphold its international commitments to promote religious freedom for all persons.

Heather Nauert
Department Spokesperson
U.S.Department of State