President Donald Trump signed two executive orders March 31 designed to curb "unfair and nonreciprocal trade," as White House National Trade Council Director Peter Navarro described it.
The first executive order commissions a report that will evaluate the magnitude of American deficits with other countries and explore the reasons for those deficits, in turn guiding policy on how to deal with trade dynamics on a country-by-country basis. Commerce Secretary Wilbur Ross said that the report would specifically look at whether or not U.S. trade deficits with certain countries are due to "cheating or other inappropriate behavior," among other things.
The report, due in 90 days to the president, will also check the effects of "asymmetrical rules" from the World Trade Organization on issues like taxation, where the international body could interrupt the creation of a proposed border adjustment tax. Ross said that the report would better define "entanglements" with other countries that have resulted in problematic trade dynamics.
"While many countries talk about free trade, they actually are far more protectionist than we are, and that reflects itself both in terms of the barriers they erect on their borders and and their behavior in terms of our borders," Ross said.
The second executive order involves a joint effort by the U.S. Trade Representative, the Department of Homeland Security, the Treasury Department and the Commerce Department to strengthen the enforcement of countervailing duties. These duties are designed to counteract the act of "dumping," in which countries export products into the U.S. below the cost of production.
But Navarro argued that the U.S. has suffered from under-collecting the amount of duties that the country is actually owed. By Navarro's figures, the country missed out on $2.8 billion in duties from about 40 countries that it should have collected, mostly due to poor bonding requirements at the border and inadequate risk assessment of importers.
"This is a big deal. It's steel, chemicals, agricultural products, machinery. It's the whole gambit," Navarro said.
The executive order directs the agencies to create a strategy, implemented within a short amount of time, that would lock down on countervailing duties while also enforcing U.S. trade and customs laws to limit counterfeit and pirated goods.
Trump made the announcement of both executive orders in a morning meeting with members of the National Association of Manufacturers, in which he blamed existing policy for outsourced jobs. In a separate speech later in the afternoon March 31, Trump emphasized that bringing jobs back to the United States was a main priority behind the pair of executive orders.
The trade executive orders come after Trump announced a meeting with Chinese President Xi Jinping, the leader of a country that Trump has called a currency manipulator.
Navarro and Ross both denied that the trade executive orders were targeted at China.