American Bolt, Nut, and Large Screw Industry Letter to the Speaker of the House and the President of the Senate Transmitting a Report.
Dear Mr. Speaker: (Dear Mr. President :)
In accordance with section 203 (b) (1) of the Trade Act of 1974, enclosed is a report to the Congress setting forth my decision to modify the import relief recommendation of the U.S. International Trade Commission (USITC) by proclaiming increased tariffs of 15 percent on iron or steel bolts, nuts, and large screws for a three-year period and giving the reasons for my decision. This report also discusses why the import relief I will proclaim differs from that recommended by the USITC.
IMPORT RELIEF ACTION BOLTS, NUTS AND LARGE SCREWS
As required by section 203(b)(1) of the Trade Act of 1974, I am transmitting this report to Congress setting forth the actions I will take with respect to iron or steel bolts, nuts, and large screws covered by the affirmative finding, on November 3, 1978, of the U.S. International Trade Commission (USITC) under section 201 (d) (1) of the Trade Act. As my decision provides import relief which differs from that recommended by the USITC, I am setting forth the reasons for such difference.
After considering all relevant aspects of the case, including those considerations set forth in section 202(c) of the Trade Act of 1974, I have determined that import relief in the form of 15 percent tariffs on iron or steel bolts, nuts, and large screws is in the national economic interest and therefore will proclaim this remedy. Under this remedy, tariffs will remain at 15 percent for large screws (including lag screws), and 15 percent plus the current tariffs of 0.2 and 0.1 cent per pound, respectively, for bolts and nuts for a three-year period after which time they will revert to their current levels (which range from less than one percent ad valorem equivalent to 12.5 percent).
As required by statute, this relief must be implemented within 15 days of this determination.
The USITC recommended that tariffs on iron or steel bolts, nuts, and large screws be increased to 90 percent and staged down to 10 percent (except for lag screws where the tariff' would revert to its current level of 12.5 percent) over a five-year period.
I have determined that the USITC remedy would not be an appropriate remedy for a number of reasons. The USITC remedy would substantially increase the cost of ferrous fasteners to U.S. consumers, thereby adding to inflationary pressures in the U.S. economy. Due to its shorter duration (three years versus five years as recommended by the USITC) and smaller tariff increases (15 percent versus 20 percent), the remedy I will proclaim will have a smaller inflationary impact on the U.S. economy, while still providing meaningful and necessary relief to the domestic fastener industry.
Given the recent increases in the prices of imported fasteners, the USITC remedy would be overly restrictive on the foreign countries that supply fasteners to the U.S. market. The smaller tariff increases that I will proclaim will mitigate the adverse impact of providing import relief on foreign suppliers of fasteners and on U.S. international economic interests.
The tariff increase remedy I have chosen should enable many domestically produced fasteners to be competitively priced relative to imports. Thus, implementation of this remedy should prevent further erosion of domestic fastener production, shipments, and employment and may allow domestic producers to increase their share of the U.S. fastener market by using currently idle capacity.
Note: This is the text of identical letters addressed to Thomas P. O'Neill, Jr., Speaker of the House of Representatives, and Waiter F. Mondale, President of the Senate.
Jimmy Carter, American Bolt, Nut, and Large Screw Industry Letter to the Speaker of the House and the President of the Senate Transmitting a Report. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/244362