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Trump announces steel and aluminum tariffs over objections from advisers, GOP leaders

President Donald Trump waves as he exits the stage after addressing the annual Conservative Political Action Conference at the Gaylord National Resort & Convention Center, in National Harbor, Md., Feb. 23, 2018. (Pete Marovich/The New York Times)

WASHINGTON - President Donald Trump on Thursday said he had decided to impose punishing tariffs on imported steel and aluminum in a major escalation of his trade offensive, disappointing Republican congressional leaders and inviting retaliation by U.S. trading partners.

Speaking at the White House, the president said he had decided on tariffs of 25 percent for foreign-made steel and 10 percent for aluminum.

"We'll be signing it next week. And you'll have protection for a long time in a while," the president said. "You'll have to regrow your industries, that's all I'm asking."

The announcement capped an on-again, off-again episode with the president initially expected to announce the trade action on Thursday morning only to cancel amid a fierce pushback from opponents. Trump acted following a determination by the Commerce Department earlier this month that rising import volumes threatened U.S. national security.

The president's move, relying upon a little-used provision of U.S. trade law, is expected to trigger immediate legal challenges by U.S. trading partners at the World Trade Organization and invite retaliation against American exports.

Trump also turned back pleas from companies that are heavy users of steel and aluminum, including auto makers, who warn that higher prices will hurt their sales and potentially lead to layoffs. In 2002, the last time the U.S. imposed steel tariffs, steel users blamed the measures for the loss of up to 200,000 jobs.

Sen. Roy Blunt, R-Mo., a membership of the Republican leadership, said before the announcement that he feared the tariffs will hurt companies in his home state.

"I continue to be concerned about what other countries do in response to that," Blunt said. "In our state, we make steel and aluminum but we continue to buy a lot more than we make. Things like sheet aluminum that you use to make boats with, we make a lot of boats, it's not available in the United States."

The U.S. already has 169 trade taxes in place on various types of imported steel, including 29 on Chinese products. Some of the nation's largest steelmakers, which sought the new tariffs, also are in good shape financially. Nucor Corp. reported a $1.1 billion profit last year.

"Import taxes on steel and aluminum will raise the prices of those products, which in turn will raise the price of doing business for US manufacturers,' said economist Christine Mcdaniel of George Mason University's Mercatus Center. "There are more people in US manufacturing sectors that rely on steel then there are in the US steel industry. In terms of the economics, the trade off does not make sense."

In a further slap at China, Trump announced the tariffs even as a top Chinese economic official was in Washington for talks aimed at forestalling a possible trade war. Liu He, one of Chinese President Xi Jinping's closest aides, is scheduled to meet with senior administration officials in a bid to restart a direct economic dialogue that lagged last year.

The on-again, off-again tariff episode came one day after the Trump administration warned that it would vigorously defend U.S. national interests against "hostile" powers such as China and Russia, vowing to use "all available tools" to combat unfair practices.

"Countries that refuse to give us reciprocal treatment or who engage in other unfair trading practices will find that we know how to defend our interests," said the annual report to Congress on the president's trade agenda.

On Thursday, China's Foreign Ministry repeated its government's objections. "The United States is disregarding the rules of the WTO, and China is dissatisfied with this," spokeswoman Hua Chunying told a regular news conference, referring to the World Trade Organization. She said such measures would affect employment in the United States and affect the interests of the United States' consumers. "As for the actions of the United States, China will take proper measures to safeguard its legitimate rights and interests."

The president's desire for wholesale change in U.S. trade policy has met with increasing resistance from congressional Republicans as well as the business community, normally a reliable GOP ally.

Despite the president's claims of progress, he has little to show for some of his central promises after more than a year in the White House. Though he promised to narrow the yawning U.S. trade deficit, it reached $566 billion last year, a 12.1 percent increase over 2016 and the highest mark in nine years.

The U.S. deficit with China last year hit a record $375 billion, the Commerce Department said last month.

Author information: Damian Paletta is White House economic policy reporter for The Washington Post. David J. Lynch is a staff writer on the financial desk who joined The Washington Post in November 2017 after working for the Financial Times, Bloomberg News and USA Today. The Washington Post's Erica Werner contributed to this report.

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