By Printus LeBlanc

Last week the Trump administration announced it would impose a 25 percent tariff on imported steel and a 10 percent tariff on imported aluminum. Many in the media and were quick to lose their mind as usual. Before judging President Donald Trump’s actions, those criticizing should look at the real world instead of the utopian society they want to live in. In the real-world trade is used as a weapon and it is time the U.S. wake up to that reality.

A 2014 White Paper from U.S. Army Special Operations Command on Unconventional Warfare discusses different methods of warfare being used by various adversaries. With regards to China, it states, “China will use a host of methods, many of which lie out of the realm of conventional warfare. These methods include trade warfare, financial warfare, ecological warfare, psychological warfare, smuggling warfare, media warfare, drug warfare, network warfare, technological warfare, fabrication warfare, resources warfare, economic aid warfare, cultural warfare, and international law warfare.”

This is more than abstract theory. There is actual recent historical evidence to prove nations use trade and economic warfare to accomplish a goal.

The U.S. and Saudi Arabia used the oil trade as a weapon against the U.S.S.R. in the 1980’s. The Soviets, as the Russians are today, were wholly dependent upon revenue from the fossil fuel industry to fund the government. President Reagan’s administration issued National Security Decision Directive 66 (NSDD-66) titled East-West Economic Relations & Poland-Related Sanctions. The actions targeted included:

• No new contracts to buy Soviet natural gas;
• Accelerate development of an alternate supply to Soviet gas for parts of Europe;
• A plan to substantially raise interest rates on credit to the U.S.S.R; and
• The requirement of higher down payments and shorter maturities on Russian bonds.

Officials calculated that for every $1/barrel drop in the price of oil, it would cost the Soviets between $500 million and $1 billion in lost revenue. At the time the price of oil was in the mid $30s, and a drop below $20/barrel would have a catastrophic impact on the Soviet economy. In 1986, the price of oil dropped down to $12/barrel, and we know what happened to the Soviet Union after that. Oil would not get back above $20/barrel until Saddam Hussein invaded Kuwait.

Rare Earth Elements (REEs) are another example of trade being used as a weapon. The group of 17 elements with unusual properties is key to modern life. It is impossible to find technology that does not have one of these elements in them. Everything from light bulbs and windmills to LED screens and cell phones have REEs in them.

The U.S. military enjoys an immense technological advantage against any foe it goes up against, and that technology has an Achilles’ heel, REEs. Writing for Breaking Defense, Richard Whittle noted the importance of REEs in the defense industrial base:

• Each nuclear-powered SSN-774 Virginia-class fast attack submarine requires about 9,200 pounds of REEs;
• Each DDG-51 Aegis destroyer needs about 5,200 pounds;
• Each F-35 Joint Strike fighter needs about 920 pounds; and
• REEs are also essential to precision-guided munitions, lasers, satellite communications, radar, sonar and other military equipment.

As important as these elements are, the production of REEs is controlled by one country and has been used as an economic weapon recently. China produces more than 90 percent of all REEs used today. In a dispute over uninhabited islands that resulted in Japanese detention of a Chinese fishing captain, China halted shipments of REEs to Japan. The action sent a shock wave around the world. Suddenly, China had the power to bring the economy of a foreign power to a grinding halt.

After years of disputes in the WTO over the actions, China decided to flood the market with REEs. Flooding the market with cheap REEs ensured no other mines in the world could compete with China, including a U.S. mine, Mountain Pass mine owned by Molycorp, that would go bankrupt in June of 2015. China now controls the rare earth market.

China was able to turn an industry valued at $4.3 billion in 2012, expected to reach $10.9 billion in 2020, and turn it into the base for its technology manufacturing industry, valued at $4.8 trillion. China was also able to demand the manufacture of products with REE components be relocated to China along with the transfer of Intellectual Property (IP). China did not get to be the second largest economy in the world by obeying the rules. China used trade warfare, and lawfare to rival the U.S. and the least policymakers can do is recognize that.

These are just two recent examples of trade warfare. It is a tactic that has been used since the beginning of time. Those complaining about what the administration did should study history. It is impossible to have a conversation about the issue if both sides cannot even admit that trade has been used as a weapon in the past. Obviously, no one wants a trade war, but how do you know the other side isn’t in a trade war already?

Printus LeBlanc is a contributing editor at Americans for Limited Government.

C/O American Energy Alliance

By Natalia Castro

Republicans in the House of Representatives have spent this week breaking down the oppressive regulatory regime the previous administration put into place. Former President Barack Obama dramatically expanded the influence of the executive branch through agencies like the Environmental Protection Agency(EPA). House Republicans are now working to pass legislation that mitigates the impact of overreaching federal policies, but barriers in the Senate could make this a difficult task.

The House has taken up two pieces of legislation this week to combat EPA overreach.

First, the Satisfying Energy Needs and Saving the Environment Act or SENSE. The legislation exempts certain coal power plants from 2012 environmental regulations in order to foster growth within the industry.

Pennsylvania Representative Keith Rothfus explained in a press release, “Huge piles of low-quality… ‘waste coal’… have become fixtures of our natural landscape. With the invention of circulating fluidized bed (CFB) technology, however, the private sector has been able to process this coal and use it to generate cheap, domestic energy…. Unfortunately, facilities that utilize CFB technology will soon be forced to shut down as a result of the compliance costs associated with the Environmental Protection Agency’s Mercury and Air Toxics Standards rule… the Satisfying Energy Needs and Saving the Environment Act… provides existing CFB facilities with relief from the unattainable hydrogen chloride and sulfur dioxide limitations of the MATS rule.”

Innovation within the private sector to lower national energy costs should be encouraged, not regulated out of existence. This is not a new idea. In fact, in 2013, just after the Obama Administration implemented ridiculous compliance demands, the House passed a nearly identical version of SENSE; however, the legislation lost momentum in the Senate when Obama announced his plans to veto the bill.

Additionally, the Blocking Regulatory Inference from Closing Kilns Act “prohibits the Environmental Protection Agency from requiring compliance with Clean Air Act rules concerning national emission standards for hazardous air pollutants with respect to brick and structural clay products manufacturing or clay ceramics manufacturing until judicial reviews of the rules are complete.” Since EPA rules are so often challenged in the courts, this prevents companies from paying compliance costs just for a regulation to be removed.

Unlike the controversy surrounding SENSE, this Act has already received bipartisan support Senators such as Roger Wicker (R-Miss.) and Joe Donnelly (D-Ind.).

The Brick Industry Association (BIA), president and CEO Ray Leonhard, explained in testimony before Congress last September, “It’s critical to complete the full legal review before manufacturers must spend millions for controls that may not be needed and could force some of them out of business.”

BIA executives believe industry leaders have invested over $100 million in EPA regulation since 2003 which have been later overturned in courts.

The second piece of legislation’s bipartisan support in the Senate should mean easy passage, garnering the 60 votes necessary to pass most measures has proven consistently difficult. Even without President Obama to call for a veto on SENSE, the Act will inevitably struggle to find nine or ten Democrats willing align with the Republican agenda.

The best strategy for passing legislation right now for the Senate is an attachment to the funding bill coming in late March. With an omnibus spending rule, Republicans can attach critical items like these as amendments to the legislation to institute comprehensive and passable reforms.

The House’s decision to combat the growth of the EPA regulatory regime could assist in protecting U.S. energy production and lowering energy costs, but only if they find an avenue to pass the legislation through the Senate as well. Senate Republicans should force Democrats to vote to close U.S. businesses and raise energy costs. But if and when that fails, attaching these items to the funding bill could be the only viable path forward.

Natalia Castro is a contributing editor at Americans for Limited Government.

By Robert Romano

“Immigration law is the province of the federal government.  This Administration and this Justice Department are determined to make it work effectively for the people. I understand that we have a wide variety of political opinions out there on immigration.  But the law is in the books and its purpose is clear. There is no nullification. There is no secession. Federal law is ‘the supreme law of the land.’ I would invite any doubters to Gettysburg, and to the graves of John C. Calhoun and Abraham Lincoln.”

That was Attorney General Jeff Sessions addressing the California Peace Officers’ Association on March 7, making it clear in no uncertain terms that California’s new “law” which makes it illegal for local law enforcement to assist federal officials in detaining illegal immigrants will not stand.

Under Sessions, the Justice Department is suing in federal court to overturn the California policy that prevents police from complying with detainer requests by federal immigration authorities.

It’s the new nullification, an unconstitutional attempt by states and cities to claim a “right” not to follow federal law.

And, warns Americans for Limited Government President Rick Manning, it is utterly dangerous. “The time of sanctuary states and cities is over. We either have laws or we have anarchy,” Manning said.

“The central presumption that the Constitution rests on is the Supremacy Clause, that the Constitution and all laws made pursuant to it are the supreme law of the land. State laws must conform to the federal in cases where the federal government has constitutional authority. It is Congress, not the states, that have the power to make the nation’s immigration laws, and states cannot constitutionally undertake an enterprise to defeat those laws,” Manning added.

Following the law is not optional, Manning declared, suggesting, “This isn’t even a grey area. It’s explicitly in the Constitution. This case tests the very premise that we can have a national union, a Constitution and a uniform rule of law, or if we will have 50 sets of rules.”

In the pre-Civil War era, there were many attempts by states to repeal or nullify federal laws that they disagreed with.

In 1832, President Andrew Jackson outlined the correct reading on nullification in his Proclamation to the People of South Carolina, a response to South Carolina’s attempt to nullify tariffs enacted by Congress, leaving no ambiguity, “I consider, then, the power to annul a law of the United States, assumed by one State, incompatible with the existence of the Union, contradicted expressly by the letter of the Constitution, unauthorized by its spirit, inconsistent with every principle on which it was founded, and destructive of the great object for which it was formed.”

Indeed, what other federal laws could states abolish that they disagree with, if following immigration law is optional? Could also states start printing their own money? Declaring their own wars? Providing and maintaining their own navies? Opting out of paying taxes?

It truly is a slippery slope. And if we’re not careful, it could spill out into other areas — taking the rule of law with it.

Meaning, the U.S. could be precipitously close to the same crisis that consumed the nation in 1861, when secession by the South in the Civil War very much tested whether the Constitution would be a lasting proposition.

The suit against California’s nullification of immigration law is an important move by Attorney General Jeff Sessions and President Donald Trump to restore the rule of law before it is too late to turn back, and they are to be commended.

At the end of the day, we are a nation of laws. And we either have a country or we don’t.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government.

By Printus LeBlanc

There is fight brewing in Congress over the funding of a local transportation project. Senators and House Members from New Jersey and New York are putting pressure on the administration to fund a massive multibillion-dollar local transportation project. President Donald Trump and Secretary of Transportation Elaine Chao are pushing back against that idea, not wanting to blow the entire transportation budget on one local project.

Why are New York and New Jersey politicians trying to get the rest of the country to finance the Big Dig 2.0?

The Gateway project is the renovation and expansion of the rail line between Newark and New York City, known as the Northeast Corridor. The project was originally supposed to be completed in 2026 and double the train capacity from 24 per hour to 48 while allowing for the possibility of high-speed rail service. The estimated price range has been anywhere from $20 billion to $30 billion, but anyone familiar with the Big Dig knows the price could quickly skyrocket to $70 billion to $80 billion. And for some reason, both New York and New Jersey believe the project is so important the rest of the nation should pay for it.

On Tuesday, Secretary Chao was peppered with questions about the lack of commitment from President Trump while testifying before the House Transportation and Infrastructure Committee. Members from the New York and New Jersey area wanted to know where the funds for the local Gateway project are.

Chao would not take the Congressional beating lying down. Chao stood her ground, stating, “New York and New Jersey have got to up their local share… New York and New Jersey are two of the richest states in the country … They need to step up.”

Perhaps the most significant line from the hearing was Chao stating, “New York and New Jersey can come up with larger than zero or five percent.” The Secretary was noting the paltry $1.75 billion and $1.9 billion committed to by New York and New Jersey, respectively, in December.

This is not what the New York and New Jersey politicians wanted to hear. New York Governor Andrew Cuomo (D) believed there was a deal in place with the Obama administration for the Port Authority to finance half of the project through user fees and the federal government would fund the remaining 50 percent.

Chao was also asked about President Trump’s involvement in the funding. It has been reported Trump asked House Speaker Pual Ryan to block funding for the project in the upcoming spending bill, which could amount to over $900 million. The Secretary stated, “The president is concerned about the viability of this project and the fact that New York and New Jersey have no skin in the game. They need to step up and bear their fair share. They are two of the richest states in the country. If they absorb all these funds, there will be no other funds for the rest of the country.”

Not only do the President and Secretary Chao not want the feds to pay for the project, but Members of Congress from around the country are also voicing their disappointment with the possibility their communities could be forced to fund the project. Rep. Ted Budd (R-N.C.) stated, “North Carolina and the other 48 states should not have to foot the bill for this hall of fame earmark.”

Two questions need to be asked of the New York and New Jersey politicians.

1. If the tunnels are over 100 years old and have needed repair and replacement for a while now, why didn’t it get done when the Democrats controlled the House, Senate, and Presidency? Wasn’t there a stimulus package for “shovel ready” jobs?
2. If Hurricane Sandy damaged the tunnels and bridges, what did they spend the $50+ billion of from the Sandy Relief bill on?

If New York and New Jersey cannot answer these simple questions, what is to stop this project from becoming another taxpayer-funded boondoggle?

Americans for Limited Government President Rick Manning stated, “Congress should not force President Trump’s hand on funding the Gateway project without states passing legislation to fund the projects themselves at the levels the Trump administration, led by Chao, deems viable to work in a true partnership. Taxpayers from Texas to North Carolina should not have to pay for projects that not even the New York and New Jersey legislatures are willing to finance for their own peoples.”

Anyone that has been in the political game for more than five minutes knows how this was going to work. The New York and New Jersey politicians were counting on the federal government to front the money to start the project. Once the project was past the point of no return, tell the federal government it cannot be completed without more federal funds, thereby forcing the American taxpayers to cover the rest of the project.

The whole country laughed at Boston’s attempt at the most expensive highway project in the U.S., known as the Big Dig. The project ran a decade behind schedule and cost 190 percent more than the original estimate. It was plagued by leaks, design flaws, poor execution, and even death. If New York and New Jersey want their own version of the Big Dig, they can have it. Just don’t ask the rest of the country to pay for it.

Printus LeBlanc is a contributing editor at Americans for Limited Government.

By Printus LeBlanc

Anyone that paid attention to the 2016 election knows the issue of illegal immigration was one of the core issues that drove President Trump to victory. For good reason, the American people were tired of open borders and criminal illegal immigrants roaming freely through their streets. President Trump is keeping his promise to deport criminal illegal immigrants, but many local politicians care more about convicted criminals than they do their own citizens.

Since President Trump took office, ICE has increased arrests by 40 percent, a far cry from the Obama administration that had a habit of releasing criminal illegal immigrants into the community. The Obama administration was so inept, or corrupt, at security it released over 19,000 criminal illegal immigrants into U.S. communities. The 19,000 had over 64,000 convictions, including hundreds of guilty of murder, kidnapping, and sexual assault. For some reason, the Obama administration didn’t believe in deporting violent criminals; the administration felt it was more appropriate to let them roam streets.

Last week, U.S. Immigration and Customs Enforcement (ICE) launched a series of raids across Northern California targeting hundreds of criminal illegal immigrants. It is important to note; these are illegal immigrants that have committed crimes in addition to being here illegally. Illegal immigrants convicted of assault, child sex crimes, and weapons charges were just a small sampling of the people targeted for removal. However, the Mayor of Oakland had different plans.

Shortly before the raids were to begin, Oakland Mayor Libby Schaaf (D) sent out a tweet warning criminal illegal immigrants of the impending raids. The warning gave the criminals time to relocate and hide. ICE still carried out the raids, but only captured 180 illegal immigrants that were either convicted criminals, had been issued a final order of removal and failed to depart the United States, or had been previously removed.

Federal immigration officials believe as many as 800 criminals were able to avoid arrest thanks to the tip-off from the Mayor. U.S. Immigration and Customs Enforcement chief Thomas Homan stated that Schaaf’s actions were, “no better than a gang lookout yelling ‘police’ when a police cruiser comes in the neighborhood.” It brings up the obvious question, did the mayor break the law?

There seem to be at least three apparent violations of the law by the mayor:

1. 18 U.S. Code 2(a) Aiding and Abetting – “Whoever commits an offense against the United States or aids, abets, counsels, commands, induces or procures its commission, is punishable as a principal.” In layman’s terms, it means assisting in someone else’s commission of a crime.
2. 18 U.S. Code 3 Accessory after the fact – “Whoever, knowing that an offense against the United States has been committed, receives, relieves, comforts or assists the offender in order to hinder or prevent his apprehension, trial or punishment, is an accessory after the fact.”
3. 18 U.S. Code 1503 Obstruction of Justice – “Whoever corruptly by any threatening letter or communication, influences, obstructs, or impedes, or endeavors to influence, obstruct, or impede, the due administration of justice, shall be punished.”

Not only should criminal charges be brought against the mayor, but Congress must also act to make sure this does not happen again, and the best way to do that is to hit them in the pocketbook. Not the city, county, or state’s pocketbook but the official’s personal pocketbook. A piece of legislation introduced in Colorado is the best way to achieve that goal.

State Senators (Vicki Marble and Tim Neville) and a pair of State Representatives (Phil Covarrubias and Dave Williams) from introduced SB17-281, the Hold Colorado Government Accountable Sanctuary Jurisdictions bill. The bill waives governmental immunity against a jurisdiction and its public employees for personal injuries caused to crime victims because a jurisdiction is a sanctuary jurisdiction. If a local official knew they could be held financially liable for the crimes committed by illegal immigrants they let go, it is doubtful sanctuary city policies would continue.

Americans for Limited Government President Ric Manning stated, “Any private citizen who engaged in the same activity as Mayor Schaaf would have been locked up and already facing charges. There is no excuse for putting law enforcement and Oakland residents in danger due to misguided loyalties. Not only should she be locked up, but all federal law enforcement funds should be frozen.”

Every drop of blood spilled by the criminal illegal immigrants the mayor warned is on her hands. She chose to put the feelings of convicted criminals over Oakland residents. The Justice Department must act, or every sanctuary city will follow the Oakland example and warn offenders of impending raids.

Printus LeBlanc is a contributing editor at Americans for Limited Government.

By Richard McCarty

According to a report it filed with the US Department of Labor, the Service Employees International Union (SEIU) spent over $2.3 million at 4- to 5-star hotels around the world in 2016. (Data for 2017 is not yet available.) With so many of SEIU’s members working low-paying jobs as janitors and health care workers, it seems unlikely that many of SEIU’s members regularly travel in such luxury.

Below are some of the amenities available at several of these fine hotels.

• SEIU spent nearly $50,000 at the 5-star Regis Washington DC, which is one of the nicest hotels in the city. The hotel is located near the White House; its lobby features crystal chandeliers, marble floors, and a baby grand piano. Most evenings, the hotel conducts a ceremony opening a champagne bottle with a saber and then distributes complimentary glasses of champagne.
• SEIU spent over $18,000 at the 5-star InterContinental Hong Kong. The hotel has stunning views of the city’s harbor. In 2016, the hotel had one fancy restaurant that was Michelin-rated; now it has two. Each hotel room includes a loaner smart phone that guests can use to make unlimited local or international calls. The phone also offers unlimited data and functions as a hotspot.
• SEIU spent over $8,000 at the 5-star Park Hyatt Chicago, the “flagship Park Hyatt hotel.” The hotel has beautiful views of downtown Chicago and Lake Michigan. Rooms in this hotel have remote control blinds, iPads, espresso machines, bathrobes, slippers, and televisions in the bathrooms.
• SEIU spent over $5,000 at the 5-star Westin New York at Times Square. Guests staying at this hotel who forgot their workout clothes can borrow pants or shorts, a shirt, socks, and tennis shoes for just a few dollars. Room service, on the other hand, is much more expensive: the room service menu offers a cheeseburger for $26, yogurt for $12, pancakes for $22, a muffin for $14, and an ice cream sandwich for $14. If none of the room service options suit guests’ appetites, they can order a chicken pot pie for $29 in the hotel’s bar.
• SEIU spent over $70,000 at the 5-star MGM Grand Detroit, one of the nicest hotels there. The hotel has a casino, a spa, an indoor pool, and Wolfgang Puck Steak, which received a 4-star rating from the Forbes Travel Guide. This rating makes the steakhouse the highest-rated restaurant in the state, according to Forbes.
• SEIU spent over $27,000 at the 5-star MotorCity Casino Hotel in Detroit, also one of the nicest hotels in Detroit. Guests can use the hotel’s spa and its pillow library and dine at the hotel’s AAA Four Diamond Award-winning restaurant, Iridescence. Iridescence is one of only five restaurants in the state receiving this award. At Iridescence, the menu includes caviar for $125 and a 6-ounce Japanese steak for $120.
• SEIU spent over $5,000 at the 5-star Taj Boston, which was previously a Ritz-Carlton. The hotel is noted for its “vast array of museum-worthy artwork.” The hotel’s restaurant, The Café, received the AAA Four Diamond Award; it is one only twelve restaurants in the state receiving this award. The hotel is located on the same block as Burberry, Brooks Brother’s, and Armani, and is across the street from Boston Commons. A Tiffany & Co. boutique can be accessed from the hotel’s lobby. The hotel offers guests a pillow menu, a bath menu, a bath butler, and complimentary shoeshines. A seasonal fireplace butler is available to assist guests staying in the hotel’s fireplace suites.

It’s a little hard to believe that SEIU had to spend over $2 million of its members’ money at fancy, swanky hotels in just one year. Surely, there were other less costly lodging options that SEIU could have chosen if SEIU’s bosses wanted to conserve their members’ funds. But because SIEU chose to spend its members’ money in this fashion, SEIU members are due an explanation as to who is traveling in luxury at their expense and why.

Richard McCarty is the Director of Research for Americans for Limited Government Foundation.

By Robert Romano

Almost a decade after the sovereign debt crisis began in Europe, with increasing sentiment for countries to withdraw from the Eurozone currency union, and for the first time in Italy, a narrow majority voted against the establishment parties.

The trouble? The Italian people voted for two separate anti-establishment parties: The Five-Star Movement with 32.7 percent of the vote and the League with 17.4 percent of the vote.

Italy has one of the largest sovereign debts in the world at €2.5 trillion but since the crisis in sovereign bond markets emerged, hitting Greece, Portugal, Ireland, Spain and Italy the hardest, the debtor nations have been held captive in the euro currency.

Any other sovereign country in such a situation would use its central bank to engage in open market operations and restore confidence to markets, essentially printing money to pay the debt. It would be default by another name.

But Eurozone countries only received assistance from the European Central Bank with very stringent terms. In essence, Brussels was taking over the sovereign decisions of member countries, and dictating terms to legislatures.

The experience helped fuel uprisings all across Europe.

The radical-left Syriza decimated the Socialists in Greece in 2015.

The Five-Star Movement in Italy has slowly gained support in successive elections since 2013 and now is the largest single party in the country. It had consistently supported a national referendum to leave the Eurozone but in this past cycle party leader Luigi Di Maio would only call such a referendum “a last resort, which I hope to avoid.”

In the UK, Brexit reached critical mass in 2016 as the British people voted to leave the European Union.

For his part, the League’s Matteo Salvini — whose party beat out Silvio Berlusconi’s Forza Italia — remains opposed to the Eurozone, stating on the campaign trail, “I remain convinced … that the euro under these conditions was an error. Which we will put right.”

Now, Salvini has become the top contender to lead a national government in Italy. He had formed a center-right coalition with Berlusconi. Together, they garnered 37 percent of the vote. Almost, but not quite enough to get the 40 percent needed to form a government.

To get across the finish line, Salvini has to make a deal. So would Di Maio, whose Five Star Movement — founded by comedian Beppe Grillo — has never joined a governing coalition, always opting for opposition.

Could Salvini and Five Star come together to address Italy’s fiscal woes?

Obstacles include divergent views on immigration, with Salvini taking a Trumpian stance against the wave of migration from the Middle East throughout Italy and more broadly Europe.

The party of Matteo Renzi, who has resigned as Prime Minister, could also serve as an obstacle, although Renzi on his way out the door suggested his party would be in opposition and not form a coalition with the Five-Stars. Renzi’s center-left coalition only received 23 percent of the vote.

Claudio Borghi, the League’s top economist suggested that the Five-Stars form a government with the center-right in an interview with Reuters: “What I would prefer for my country would be the centre-right and 5-Star because I think we could find common ground.”

Which, there is something to be said for that. One thing that united Five Star and the center-right was opposition to Renzi’s proposed constitutional referendum, which failed by about 6 million votes, losing 41 percent to 59 percent. In many ways, the same coalition showed up in Italy on March 4.

But Salvini ruled it out such a grand coalition, at least initially, stating, “The 5-Stars have changed their minds too many times and on too many topics, so for me it’s a big ‘no.’”

What about with Renzi? Salvini was quick to quip, “I won’t comment on the debacle of others, Matteo Renzi’s arrogance has been punished.”

To get to the 40 percent needed to form a government, Salvini will either have to make a deal with Di Maio or with perhaps smaller members of Renzi’s coalition.

Di Maio could play the kingmaker or could form the opposition with Renzi’s party.

If the center-right and parts of the center-left cannot form a coalition, then Di Maio may be more well-positioned to assume control, in a coalition with parts of the center-right coalition or with Renzi’s party.

The question is, what happens? Who knows? It’s Italy. Under their constitution, the President of Italy, Sergio Mattarella, determines which party gets an opportunity to create a government. By its nature, the system calls for compromise. Anything could happen. Stay tuned.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government.

By Robert Romano

President Donald Trump is keeping the promise he made in 2016 and is protecting the American steel industry, instituting a 25 percent tariff across the board on steel imports. No nations are excluded.

The move comes as the U.S. imported 34.5 million metric tons from around the world, a 16 percent increase from 2016 when it was 30 million metric tons.

In comparison, while America’s steelworks are heating up once again, they comparatively only grew by 3.4 percent in 2017 according to the International Trade Administration to 81.6 million metric tons from 78.5 million metric tons.

This flooding of U.S. markets is designed to drive down prices here by dumping subsidized steel products here, making it harder for domestic producers to maintain market share. The imported steel is much cheaper.

In the event of war, keeping U.S. productive capacity at high levels is critical, to prevent shortages at a time when production would be needed the most and imports cannot be guaranteed.

As the Commerce Department noted in its recommendation for instituting the tariffs: “Domestic steel production is essential for national security applications. Statutory provisions illustrate that Congress believes domestic production capability is essential for defense requirements and critical infrastructure needs, and ultimately to the national security of the United States.”

That is one reason the Commerce Department in its findings suggested that the U.S. use at least 80 percent of its annual capacity including imports. Right now, that number is only at 72.3 percent because of the flooding of domestic markets. The report found “Utilization rates of 80 percent or greater are necessary to sustain adequate profitability and continued capital investment, research and development, and workforce enhancement in the steel sector.”

In other words, allowing rampant flooding of U.S. markets by foreign steel is not only harming a domestic industry’s profitability, in the process it is weakening that industry’s ability to defend the national security of the United States in the event of war.

Here, the circumstances surrounding the tariff matter a lot. Allowing foreign dumping weakens the entire sector and makes sustaining a war effort harder. To be a strong nation, we need a vibrant domestic steel industry.

Foreign dumping of steel is eating the domestic market share, and in the future it could harm us at a time when we can afford it the least. We never know when war will come.

Even if the tariffs resulted in less consumption of imported steel, the U.S. steel industry appears ready to pick up any slack. Indeed, the whole point is to stimulate demand for U.S.-made steel.

Yes, it’s a tax. But there are few other tools available to address increasing dependence on foreign steel and foreign dumping onto domestic markets. This happens to be one of the tools that’s actually in the Constitution.

To ignore violations of trade agreements does not strengthen free trade, it weakens the argument for it. Again, it is not conservative to allow for rampant breach of contracts, it is corrupt.

Critics will argue that the tariffs will result in reciprocal tariffs on U.S. steel. But we import far more than we export, as the rest of the world does not return the favor. All it does is send its subsidized steel here. It’s not nearly as interested in buying ours.

Others will complain that taxing Canada and Mexico will harm North American Free Trade Agreement (NAFTA). 16 percent of U.S. imports of steel come from Canada. 9 percent comes from Mexico.

However, if every nation was not included in the tariff, there would be a perverse incentive for companies to ship their steel to Canada and Mexico, and then dump it here to avoid the tariffs.

This is something that has already been seen in recent years with dumping of aluminum in Mexico by China to circumvent NAFTA.

In fact, China currently has a 50 percent global market share in steel. How much of that excess capacity is being passed through global markets and into U.S. markets via free trade zones? It is hard to say, since such abuses are hard to catch. Steel is often recycled, making it tough to trace its origins when imports finally arrive here. With an across-the-board tariff, any incentive for such shenanigans ceases.

Moreover, one wonders what other domestically produced materials needed for national security the U.S. should outsource? Rare earths? Already done. Uranium? We’d be stupid to become dependent on foreign sources of the commodity needed for nuclear weapons.

Why should steel be treated any differently? Having a robust, domestic and, yes, profitable steel industry is critical to defending this nation. Letting foreign economies dump here without reciprocal action constitutes a threat to national security.

Others still will raise objections simply out of general opposition to any and all tariffs. However, they might consider that it is reciprocity in reducing tariffs that has led to freer trade historically. Dumping, subsidies and tariffs beget more tariffs. Which is key to point out. These tariffs are in response to actions by foreign trade partners. They’re the ones provoking us.

The tariff is expected to raise $9 billion in revenue and increase U.S. domestic market share. The Commerce Department report predicts, “According to the Global Trade Analysis Project (GTAP) Model, produced by Purdue University, a 24 percent tariff on all steel imports would be expected to reduce imports by 37 percent (i.e., a reduction of 13.3 million metric tons from 2017 levels of 36.0 million metric tons).  This tariff rate would thus result in imports equaling about 22.7 million metric tons, which will enable an 80 percent capacity utilization rate at 2017 demand levels (including exports).”

Overall, the 25 percent steel tariff ends what amounts to $8 billion of foreign aid every year — when the value of the decreased imports are taken into account — to other countries to increase their global market shares in one of the world’s most valuable commodities.

President Trump promised reciprocity in trade. Sometimes that means tariffs when trade partners cheat. If U.S. trade partners don’t like it, they might consider not dumping subsidized steel and aluminum here in violation of U.S. law. To keep America safe, we need to keep American steel strong.

Robert Romano is the Vice President of Public Policy at Americans for Limited Government.

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By Natalia Castro

Within the last month, more than 160 million Americans opened their bank accounts to find that the recently passed Republican tax plan provided them with a more substantial paycheck and more economic mobility.

But one area of the tax code appears to have had unintentional consequence of picking winners and losers in agriculture.

Despite the overwhelming benefits for families and small businesses a provision within the tax plan could have far-reaching negative consequences on agricultural products sold to private buyers. This provision, seemingly entered as a last-minute mistake, must be rectified during the March funding debate in order to provide equal competition to the market.

Section 199A of the tax reform law provides additional tax incentives to farmers who sell agricultural products to co-ops rather than independent private buyers. When selling to co-ops, farmers can now deduct up to 20 percent of their total sales made; however, when selling to privately held or investor-owned companies, the farms can now only deduct 20 percent of income.

Jacob Bunge and Richard Rubin of the Wall Street Journal put this into context, “Consider a simplified example of a wheat farmer with $500,000 in annual grain sales and $80,000 in profit. A farmer selling grain to a cooperative could deduct 20 percent of sales, wiping out the entire income-tax liability. By contrast, if the farmer sells grain to an independent grain operator, the farmer’s deduction would be limited to 20 percent of the profit, or $16,000, leaving that farmer with up to $64,000 in taxable income.”

This provision removes natural competition from the market by financially coercing farmers to sell to co-ops rather than private entities.

David Fiebiger, general manager of the private grain elevator on the western edge of Aberdeen, South Dakota, told Ag News in January, “Unintended consequences of Section 199A give the farmer incentive to sell to a co-op versus a nonco-op… Over the past couple weeks, a lot of the people that sit at the table have realized the unintended consequences and have been in agreement that something needs to happen to change that to get the playing field back to even.”

Several news agencies and politicians have begun calling this the “grain glitch” for its far-reaching negative consequences on the US grain industry. Scott Greenburg of the Tax Foundation has noted that this glitch could create a hole in the tax system, allowing some household and business to shield their income entirely from taxes through the use of co-ops.

The worst part is that this provision has no reason to be included in the tax reform legislation. After revisions to the bill did away with deductions on domestic grain production that was available to both manufacturers and farm co-ops, Senate Agriculture Committee member John Thune (R-S.D.) added Section 199A to offset the removed deductions.

Negative feedback from farmers has caused Senator Thune and other agriculture state Senators, such as Senator John Hoeven (R-N.D.), to rethink the provision. Ryan Wrasse, a spokesman for Thune, told the aforementioned Ag News that the senator is working on tweaking the law to better even the playing field.

“Ultimately, Sen. Thune believes that producers should make decisions about where and how to sell their products without the tax code unfairly tipping the scales in favor of marketing to one type of business entity or another,” Wrasse wrote in an email.

Additionally, 86 members of the House of Representatives sent a letter to Speaker of the House Paul Ryan and Senate Majority Leader Mitch McConnell urging Congress to address the provision. The letter reads, “Unfortunately, Section 199A goes too far and has created a tax advantage for producers who sell to cooperatives instead of private and independent businesses… We’re concerned this provision unfairly distorts the marketplace with the potential to reduce competition, directly harm small and independent businesses, and increase consolidation in the agriculture industry.”

With government funding set to expire on March 23, the next government funding bill could be a vital opportunity to solve this mistake.

As Americans for Limited Government President Rick Manning noted in a March 2018 press release, “Congress needs to take action immediately in the next funding bill to restore fair competition between farm co-ops and private and independent businesses… Government should not be picking winners and losers like this in the tax code.”

The tax cuts are and will continue to be a win for most Americans, but for it to truly allow for fair competition in the agricultural sector and to stop distorting markets, Section 199A must be altered. With funding discussions coming this month, Congressional members must listen to the numerous House representatives and members of the agricultural community urging change and rectify this harmful provision.

Natalia Castro is a contributing editor at Americans for Limited Government.