Trump Winning Battle Against Business Groups on Tariff Authority

(Bloomberg) -- Donald Trump is fending off a U.S. Chamber of Commerce-backed effort to limit his tariff authority as top Republicans back away from challenging the president to avoid opening a rift in the party ahead of the November elections.

White House lobbying has softened the stance of key Republicans as some lawmakers back bipartisan legislation to take away the president’s authority to issue national security-based duties without getting the approval of Congress.

Trade has split the GOP like no other issue in the Trump era, with his imposition of steep tariffs against longtime partners like Canada, Mexico and the European Union sparking strong opposition from senators who still support the party’s traditional free-trade policies. Senators, particularly from farm states, have lobbied Trump for months against starting a full-scale trade war that could dampen economic growth.

But a two-hour White House meeting with Trump on Wednesday appeared to mollify several, including Senator Chuck Grassley, an Iowa Republican, who said he was encouraged that Trump will soon cut better trade deals, including a revised North American Free Trade Agreement.

GOP Senator Ron Johnson of Wisconsin, who had signed on to an effort led by Senator Bob Corker to limit the president’s authority to issue national security-based duties, now says he still supports the tariff-review plan but the timing might be better after the current round of negotiations. Corker, a Tennessee Republican, is seeking to attach the measure next week to a popular annual defense measure under debate on the Senate floor.

"I do not want to take away leverage from President Trump," Johnson said. Corker is “absolutely right, but I also understand the president’s viewpoint too,” he said.

Broader Legislation

Senate GOP leaders are weighing plans that would push any vote on the matter past the November election. Senator John Cornyn of Texas, the No. 2 Republican leader, told reporters Thursday that it might make sense to move the tariff review bill to the Finance Committee for consideration, and include it as part of some broader legislation addressing the president’s trade powers.

Cornyn said he couldn’t predict how long it might take to agree on such legislation. While Cornyn said the supporters of restrictions on Trump’s tariff authority deserve a vote, “this is not the time to pick a fight with the president in the run-up to a midterm election.”

The senators’ positions are a setback for efforts by the Chamber of Commerce and other business groups seeking GOP allies in a fight against Trump’s recent duties on aluminum and steel imports from key U.S. trade partners. The Corker legislation opens the possibility of ending the new tariffs because it would cover not only future actions, but any taken within the last two years.

Business groups supporting the tariff-review bill include the National Retail Federation, the Retail Industry Leaders Association and the Motor and Equipment Manufacturers Association. On Thursday, the Association of Equipment Manufacturers joined the list of supporters of a bipartisan bill that now has more than a dozen co-sponsors.

‘Creating Chaos’

“President Trump’s global trade war is creating chaos here at home,” said Hun Quach, vice president of international trade at the retail leaders’ group. “We are hopeful the president will listen to the business community and members on both sides of the aisle when we say tariffs are not the answer.”

Some Republican lawmakers aren’t backing down. GOP Senator Jeff Flake of Arizona took to the Senate floor Thursday morning to call on lawmakers to stand up to Trump.

“We were elected to be leaders, not followers,” Flake said. “It’s not our charge to just go along because the president shares our party affiliation to throw out our long-held beliefs because it might complicate our political standing.”

Senator Pat Toomey of Pennsylvania is among the bill’s co-sponsors who join Corker in continuing to press for a vote within days, even as there may be procedural challenges to its inclusion on the defense measure.

Toomey said Senate Majority Leader Mitch McConnell said he would support an open amendment process on the defense bill “so that would imply that there ought to be a vote."

Others warn that their patience will run out if Trump doesn’t produce trade deals. Senator Lindsey Graham of South Carolina also said he doesn’t want to undermine the president’s negotiating clout at a crucial time, but suggested Trump needs to show results.

“I don’t have a deadline, but if this goes on and on forever, then Congress will get more nervous,” Graham said. “If we did something next week, it would undercut him."

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