Congress Strikes Back!

For decades, the executive branch has been the chief architect of trade policy…and now Congress is maneuvering to take back control. A number of initiatives Congress is considering may impact manufacturers…including measures to curtail circumvention (country hopping to avoid tariff). To control costs and reduce risk, a carefully designed and monitored supply chain is more critical than ever.

From 1917 to 1977, Congress passed several laws that delegated power to negotiate trade deals and execute trade policy – from the legislative to the executive branch. The Trump administration exercised its authority by imposing tariffs on numerous countries. The pattern of his predecessor has continued into the Biden administration, with a number of initiatives getting executed — all without a single vote in Congress.

In recent months, both the House and Senate in bipartisan agreement are working on several legislative initiatives to wrestle power back and play a larger role in trade.

An example of interest for manufacturers: circumvention

In this latest video, Omar Nashashibi of The Franklin Partnership describes the ways in which Congress is attempting to flex muscle. For example, the Level the Playing Field 2.0 Act moving through Congress is intended to prevent “country hopping” – the practice of avoiding duties by moving goods made in a tariffed geography through a non-tariffed geography before reaching the USA.

Hear more examples in Omar’s latest video: Congress Strikes Back!

Note: CLA contracted with The Franklin Partnership and Omar Nashashibi has been contracted by CLA for this video and audio series.