If the Biden administration gets its way, foreign governments will soon be free to restrict exports of U.S. farm goods, digital services, manufactured products, and everything else made in America. All they have to do is suggest those goods and services threaten their security.
That’s based on the Biden administration's hysterical response to a World Trade Organization (WTO) ruling against U.S. steel and aluminum tariffs that were imposed for alleged national security reasons.
WTO rules encourage free trade, but an exception allows countries to restrict imports in rare cases based on national security threats. The WTO ruled that the steel and aluminum tariffs were not justified based on this exception. That’s not a particularly far-fetched view. Here in the United States, Sen. Mark Warner (D-VA) echoed the views of many other legislators when he said the U.S. tariffs stretched the concept of national security “beyond credulity.”
The Biden administration’s response to the WTO was a dramatic overreaction: “[T]he WTO has no authority to second-guess the ability of a WTO Member to respond to a wide-range of threats to its security.”
If that’s really the case, WTO rules are meaningless since any country can flout the rules based on unchallengeable national security concerns.
Ironically, the predecessor to the WTO, the General Agreement on Tariffs and Trade, was signed into law by President Harry Truman in 1947 largely based on national security grounds as a way to counter the Soviet Union. Senator Joe Biden later voted to join the WTO, and President Bill Clinton signed the implementing legislation into law. Now more than ever, the viability of the WTO is in doubt.
The most immediate effect of the U.S. Trade Representative’s (USTR) action is to undermine Biden administration Secretary of Agriculture Tom Vilsack’s efforts to keep Mexico from banning purchases of U.S.-grown genetically modified corn.
Sec. Vilsack has threatened to initiate a trade dispute against Mexico. But since trade rules in the WTO and the U.S.-Mexico-Canada Agreement each include a national security exception, all Mexico has to do is print out a copy of the USTR national security news release, wave it in the face of U.S. officials, and proceed to do whatever it wants.
Welcome to the jungle, baby.