As a result of last year’s midterm elections in the United States, as the Republican Party gained a majority in the House of Representatives, it was analyzed that the US’ ethnocentrism would intensify along with the policy of pressure on China.
On the 10th, the International Trade Institute of the Korea International Trade Association (KITA) predicted how the Republican-dominated House of Representatives would affect US trade policy in a report titled “Changes in Congressional Leadership and Trade Policy Direction in the Republican-led House of Representatives.”
As a result of last year’s midterm elections, Republicans regained the majority in the House of Representatives for the first time in four years. The Democrats secured an additional Senate seat and maintained their majority in the Senate. Other parties took over the federal Senate and House of Representatives, respectively, and the formation of the Republican-led House of Representatives and the Democratic-led Senate took place in eight years.
The report predicted, “The House of Representatives will exert influence on US trade policy through the Ways and Means Committee, the Trade Subcommittee under the Ways and Means, and the China Special Committee, which was newly established this year.” The House Ways and Means Committee is responsible for legislation related to revenues, including taxes and tariffs. It is the oldest committee in Congress and one of the most influential in the House of Representatives. In particular, Jason Smith (Republican Party, Missouri), a conservative hardliner with a pro-Trump tendency, was elected as the House Ways and Means Committee. This is the background in which conflicts between Congress and the administration are expected over future trade policy promotion and related legislation.
In particular, Chairman Jason Smith is inclined to cut the IRS budget included in the Biden administration’s Inflation Reduction Act (IRA), secure food, medicine, and energy security, strengthen U.S. reshoring and supply chains for companies, and promote U.S. worker-oriented policies. . At the same time, it has foreshadowed a tough response to China.
However, the report analyzed that “Chairperson Jason Smith has no experience dealing with trade issues in the Revenue and Revenue Committee, so the influence of the Trade Subcommittee is expected to play a large role.” Adrian Smith (Republican Party, Nebraska), who served as the secretary of the 117th trade subcommittee, was elected as the chairman of the 118th trade subcommittee. The Trade Subcommittee has the authority to approve budgets for functions of the International Trade Commission, Trade Representative, and Department of Homeland Security under the jurisdiction of the Subcommittee, such as tariff concessions/preferences, unfair trade practices, import regulation, trade negotiations and implementation of trade agreements, and trade adjustment support. Chairman Adrian Smith criticized the Biden administration for being passive on the trade agenda, citing strengthening the supply chain, reducing inflation, and developing new markets as key tasks.
In particular, the House of Representatives established a China Special Committee dedicated to strategic competition issues with China, and elected Mike Gallagher (Republican, Wisconsin), a hardliner on China, as its chairman. The Chinese special committee, which consists of 13 Republicans and 11 Democrats, has no legislative authority. However, it will be tasked with examining the Chinese government’s strengthening of its economic, technological and security capabilities and competition with the United States, and presenting policy recommendations based on this.
In particular, Chairman Gallagher is said to emphasize investment in domestic manufacturing capabilities to build a foundation for the technology industry, as well as cooperation with allies, and support the introduction of a regulatory mechanism for American companies to invest abroad. It is the background that he believes that he will pursue a policy for the revival of the United States based on containment against China.
In addition, the Republican-led House is expected to expand checks on trade and economic cooperation policies promoted by the Biden administration, such as opposing the Inflation Reduction Act (IRA) spending plan and demanding congressional approval of the Indo-Pacific Economic Framework (IPEF). do. Republicans favor traditional trade agreements that include open markets over economic cooperation agreements that do not include market access. It means creating a market in which American goods can be exported and sold, while at the same time promoting economic cooperation. Accordingly, the report analyzed that “the House of Representatives’ pressure on the revival of the ‘Trade Facilitation Authority (TPA)’ may intensify.”
The Trade Promotion Authority (TPA) is a system that contains rules that allow Congress to temporarily delegate broad negotiating powers to the president to expedite trade negotiations. However, the Democratic administration is of the view that IPEF does not address market openings (tariff concessions) and therefore does not affect revenues, so congressional approval is not required, and a TPA is unnecessary.
Jeong Hae-young, a senior researcher at the Korea International Trade Association, said, “Since both parties are showing strong anti-China stance, bipartisan legislation and policies to contain China are expected to be pursued separately from the formation of the parliament.” It can also be amplified.”
Byun Jong-guk, reporter [email protected]
Source: Donga