A U.S. lawmaker proposed March 4 to exempt from President Donald Trump's proposed tariffs on steel and aluminum all "fairly traded" contracts, Reuters reported.
Kevin Brady, chairman of the U.S. House of Representatives Ways and Means Committee, wants the exemption especially for Canada and Mexico. Brady spoke at the sidelines of the latest round of NAFTA talks.
"I believe there should be a quick and timely inclusion process for existing contracts as well as for existing businesses," Brady said.
Canada, the single largest supplier of both steel and aluminum to the U.S., said any tariffs would be unacceptable.
U.S. Representative Bill Pascrell, senior Democrat on the Ways and Means trade subcommittee, also pushed for exemptions. "We don't have a major trade deficit with Canada," he said. "If we can't make an exception there, then how are we going to get a NAFTA deal?”
Peter Navarro, who heads the White House Office of Trade and Manufacturing Policy, however, said that there will be no exemptions. "As soon as you start exempting countries, you have to raise the tariffs on everybody else," Navarro told the Financial Times.
Federal Reserve officials also weighed in their concerns on the tariffs. Said Minneapolis Fed president Neel Kashkari: "If you raise steel tariffs, are the steel jobs in the U.S. going to more than make up for the economic effect [on] everybody who is a steel consumer?" He said the answer is a "resounding" no, the FT reported.
New York Fed President William Dudley on March 1 said the impact of the tariffs in the longer term would "almost certainly be destructive."
The new Fed chairman, Jay Powell, at a Senate hearing on March 1 said "the tariff approach is not the best approach." While some areas were adversely affected by imports, the best way of responding was to directly help those communities, he said.
