President Biden, seeking to curry favor with blue-collar workers and avoid being outmaneuvered on trade by his Republican rival, former President Donald J. We are strengthening our efforts to protect it.
The move has strained Mr. Biden's relations with international allies and rivals alike, raising concerns about protectionism from diplomats and some economists, including senior Chinese officials during Treasury Secretary Janet L. Yellen's recent visit to Beijing. It is inviting criticism.
But the move emboldened labor unions, environmental groups and other key members of Mr. Biden's political base, particularly in battleground states in the industrial Midwest.
Mr. Biden and his administration have recently signaled that they are preparing new tariffs and other measures to block imports of cheap electric vehicles and other clean energy from China. These efforts, coupled with new restrictions on U.S. investment in China, restrictions on exports of advanced technology, and subsidies for the U.S. semiconductor industry, fueled major tensions during Yellen's visit.
Hours after she left a press conference in Beijing, the Biden administration announced plans to invest up to $6.6 billion in efforts to bring the most cutting-edge technology to Taiwan Semiconductor Manufacturing Co., a leading manufacturer of cutting-edge microchips. announced that it would provide subsidies. We provide cutting-edge semiconductor technology to the United States. The administration is pumping billions of dollars into semiconductor companies, aiming to reduce dependence on China for critical microchips.
The president also expressed opposition to a proposed takeover of iconic domestic manufacturer US Steel by Japanese steelmaker Nippon Steel, saying US Steel should be domestically owned and saying, “I stand with the steelworkers.'' I said yes, and I meant it.”
His position has created an economic rift with key allies and could become a focus of discussion when Prime Minister Fumio Kishida visits the White House this week for talks with the president and a state dinner on Wednesday. Highly sexual.
Biden's industrial policies, including subsidies for technology aimed at cutting global warming fossil fuel emissions, also continue to irritate some European leaders. Some of these moves have drawn internal backlash from Biden's economic team and outside economists who warn they are reducing incentives for foreign companies to inject much-needed investment into the U.S. economy.
The politics behind Biden's strategy are clear. When it comes to manufacturing, the president wants to leave no doubt that he is as “America First” as Trump, if not more so.
America's trading partners are “looking at November and wondering which outcome is going to be worse.” Inu Manak, a trade policy fellow at the Council on Foreign Relations in Washington, said he wrote a scathing critique of Biden's trade and industrial policies earlier this year. “On the economic front, it’s not so great, but it’s even worse.”
Still, the move appears to have helped Biden garner much-needed support from the United Steelworkers union ahead of the November election. The union cited Biden's infrastructure bill and other economic bills, including Buy America provisions, in a statement of support, saying the president is “promoting domestic manufacturing and broader prosperity not just in the short term but well into the future. '' was a broad declaration. ”
Trump attacked China on his way to the White House in 2016, promising to revitalize American factories. During his tenure, he imposed tariffs on more than $300 billion of Chinese imports and imposed restrictions on some U.S. technology transfers to China. Trump, who is seeking his return as president, has called for new across-the-board tariffs and a significant “decoupling” of trade relations between the United States and China.
Mr. Biden has not gone that far, but he has kept many of Mr. Trump's tariffs in place and placed new restrictions on exports of some U.S. high-tech semiconductors to China. In official economic publications, Mr. Biden's aides have taken a more nuanced view on trade than Mr. Trump.
“The benefits of trade and cross-border investment flows are well documented,” Biden's team said in the president's annual economic report released last month. “The benefits of global integration include lower inflation, greater diversity of goods and services, increased innovation, increased productivity, better employment for U.S. workers in export sectors, and increased demand for U.S. industries overseas.” These include direct investment and improving the likelihood of achieving climate change targets.”
But Biden's economists went on to warn that “policymakers must continue to pay close attention to the negative impacts associated with global integration and some trade policies,” most notably Job losses and other harm to American workers.
Yellen has expressed these concerns to Chinese officials in recent days. The Biden administration is concerned that the Chinese government is deliberately flooding the global market with cheap, heavily subsidized green technologies such as electric cars and solar panels.
“We've seen this story before,'' Yellen said at a press conference near the end of her visit, explaining that the Chinese government's aid 10 years ago led to “low-cost Chinese steel flooding the world market, It destroyed the industry in China.” In the world and in America. ”
“President Biden and I have once again made it clear that we will not accept that reality,” she added.
Chinese officials have accused the Biden administration of protectionism. The official document from Yellen's meeting with Premier Li Qiang in Beijing read: “China expects the United States to work with the Chinese side to adhere to the basic norms of the market economy of fair competition and open cooperation, and to I hope that they will refrain from making this a national or national issue.” -Securitization of economic and trade issues. ”
Mr. Biden also risked antagonizing Japanese authorities last month by declaring it was “critically important” that Pittsburgh-based U.S. Steel remains “domestically owned and operated.”
U.S. authorities are considering the merger on national security and antitrust grounds. It has been encouraged to do so by steelworkers unions, environmental groups concerned about high emissions from the combined companies, and a bipartisan group of senators, mostly from industrial states.
One such critic, Sen. Sherrod Brown (D-Ohio), faces a tough re-election battle. He sent a letter to Biden this month requesting an investigation into Nippon Steel's ties to China's steel industry. “This deal is bad for American workers and bad for our economy and national security,” Brown wrote.
Nippon Steel and U.S. Steel officials have publicly disparaged Mr. Biden, pushing for a shareholder vote on the merger this week and announcing in Pennsylvania that Nippon Steel plans to invest billions of dollars in U.S. production. We are running digital ads that emphasize Japan hired the prominent Washington lobbying firm Akin Gump. Perhaps most importantly, it is attempting to negotiate peace with the steelworkers' union, which has been harshly critical of the proposal.
“We continue to support this transaction and are confident it will be approved after a fair and thoughtful evaluation,” the companies said in a joint statement. “Nippon Steel's investment is the best path forward for U.S. Steel's employees, customers, shareholders, Pennsylvania, and America.”
Japanese officials appeared surprised and shaken by Biden's comments and the prospect that the president might call off the merger.
Michael R. Strain, an economist at the conservative American Enterprise Institute who discussed the merger, said, “The United States says Japanese companies investing in American manufacturing companies is a threat to U.S. national security. That's strange and worrying.” week with Japanese officials.
“My sense is that the timing of this in an election year is important,” Strain said. “This seems more like a show of support for manufacturing in swing states than any actual security concerns.”
Biden administration officials downplayed the importance of the merger during bilateral talks scheduled for Wednesday, saying it would be a challenge for world leaders, including security concerns with China and North Korea and deepening cooperation with South Korea. This is one of the many topics on the agenda.
“There are a lot of important things to talk about with Prime Minister Kishida,” White House national security communications adviser John Kirby told reporters last week. “Certainly the economies of both countries are on that agenda and there is no question that economics, economic and trade issues will come up.”
Alan Rapeport Contributed to reports from Beijing.