Jan 29, 2019
Freedom Partners Opposes the Reciprocal Trade Act in Open Letter to Congress
Post by Freedom Partners
Freedom Partners Chamber of Commerce signed onto an open letter with the National Taxpayers Union, Americans for Prosperity and Americans for Tax Reform, among others, to oppose passage of the so-called “Reciprocal Trade Act” (H.R. 764).
The legislation would grant the executive branch even greater power to unilaterally impose tariffs, which is a problem on several fronts.
First, the Reciprocal Trade Act is unnecessary.
“Trade Promotion Authority already empowers the president to negotiate trade agreements to submit to Congress for review and approval,” the letter notes.
What’s more, the historic decline of international trade barriers since World War II can be attributed to successful trade negotiations. That reflects a global acknowledgement that trade barriers are self-destructive.
“In reality, [this bill] is more likely to lead to a tit-for-tat retaliatory trade war that closes foreign markets, reversing decades of market-opening progress under U.S. leadership,” the letter reads.
Underlying the Reciprocal Trade Act is the mistaken notion that trade deficits harm economic growth, when in reality, they are often signals of foreign investment in American businesses.
“Either way, Americans benefit when trade grows,” the signers note.
Lastly, the Reciprocal Trade Act would undermine the checks and balances essential to responsible governance. It takes taxing power properly held by the legislative branch and grants it to the executive branch, in defiance of Article I of the Constitution.
This means that the executive branch can unilaterally raise taxes — which is what tariffs really are — on the American people.
“Members of Congress should not support this legislation and should not abdicate their constitutional role in the regulation of international commerce,” the letter concludes.