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Pennsylvania Steel Region Divided On Trump's Unexpected New Tariff Policy

MICHEL MARTIN, HOST:

We're going to start the program today with that dramatic announcement this week by President Trump that he will impose a 25 percent tariff on steel and a 10 percent tariff on aluminum imports as early as next week. It's a move that could have a profound effect on prices in the U.S. and on trade and diplomatic relations with the U.S. And the move is making some strange bedfellows as some Democrats and union groups are applauding the president's decision while members of his own party are criticizing it.

We're gathering different points of view about this all weekend, and we're going to start with Congressman Ryan Costello. He is a Republican. He's in his second term representing Pennsylvania's 6th District, which is northwest of Philadelphia. You might remember that reviving the steel industry was one of President Trump's campaign promises, and that's one of the factors cited in Mr. Trump's victory in Pennsylvania in the 2016 election. But he didn't win Mr. Costello's district, where Hillary Clinton won narrowly.

And Congressman Costello is with us now. Congressman, thanks so much for speaking with us.

RYAN COSTELLO: Great to be with you. Strange bedfellows is an apt description for sure.

MARTIN: Well, tell me about this. I mean, and let's set the table first if you can. Your district still has steel manufacturing in it. Am I right about that?

COSTELLO: On the circumference of it, yes. Additionally - little known fact - the only domestic keg company in the country is in my district. And I spoke with them yesterday, and they are extremely happy with the decision because of what the price of aluminum from China is. So there's a lot of crosscurrents in terms of who supports this as well as - some who would normally support the president's economic policies have very deep-seated concerns over it.

MARTIN: Well, tell me yours. What's your reaction to it?

COSTELLO: Well, this is certainly doubling down to those who supported him. And he's consistent here with whom he is looking out for. It does remain to be seen what the actual policy is. This is - this could - may at the moment be similar to withdrawal of the Paris accord - right? - which pleased his supporters but has not yet happened. So it remains to be seen formally what steps are taken.

The concern, though, is the unpredictability and the market uncertainty associated with what European Union and WTO nations will do as retaliation. They can be very, very sophisticated in terms of the types of industries, even the types of states or constituencies that they might like to send a message to with tariffs on us.

The other element here that's deeply concerning is the president's very simplistic notion that trade wars are good, that we will win them, that it's easy and that if they don't come to play, then we just won't ship anything to them. Well, then that country is going to go somewhere else, and it means that our main domestic manufacturing could suffer as a result. So there's a lot more at play here, and it's not a simplistic, we're going to put tariffs down, and that's going to solve all the problems. It's likely to create some problems as well.

MARTIN: I take it from your comments here that you're just not sure how you feel about this yet. Am I right about that?

COSTELLO: Because it's so new - it's very nuanced, and it remains to be seen. He may - look; whether the president even follows through with the 10 and 25 percent tariffs remains to be seen. What retaliatory measures European Union countries take remains to be seen. Whether we can even go through with a 232 process under the realm of national security - which, by the way, is the only way that the president is able to do this - remains to be seen.

So I think that there's a lot of question marks. The politics of it, though, are very idiosyncratic because it is going to bring some labor constituencies, some historically Democratic constituencies as well as those who may have never voted before - say, this is the president; he's doing what he said he was going to do. And there are a lot of people in this country that feel that and see that.

At the same point in time, what you might call free market Republican constituencies - and I have a lot of businesses that would fall into that category; I myself probably would be coined that - do see the potential harm associated with this if it is carried out because our trading policies are not in a vacuum.

MARTIN: So let me just say this. One of the things that's interesting about your district and one of the reasons we called you is that you're kind of in the middle. I mean, on the one hand, you do have steel makers on one side in part of the district. Just to your west, you've got a lot of farmland, for example.

COSTELLO: Yes.

MARTIN: I mean, just heading toward Hershey, you've got a lot of farmland, and agriculture is one of the places that trading partners tend to retaliate. So...

COSTELLO: Absolutely.

MARTIN: And adding to that is your district is kind of 50/50. I mean, it's almost - it's, like, evenly split between Republicans and Democratic voters. At least in 2016 it was.

COSTELLO: That's right.

MARTIN: So the question for me is, how are you going to thread that needle? I mean, at the end of the day, at some point, you're going to have to take a position. How do you think you're going to weigh your views on this?

COSTELLO: Some of it's going to be based on the facts. Look; I'll say this to you. I'm not going to agree with the president if I don't agree with him. The problem here is the market uncertainty that's created as well as this came out of nowhere. And those sorts of things are not the way to lead on an issue like this. That's my bottom line at the moment. I - and I just don't see a scenario where the EU cooperates or allows this to happen without retaliatory measures that are going to have an impact on a lot of consumers in this country. That's what they're going to have to do as a retaliatory measure.

I just think it also remains to be seen on what is the process that the president actually undertakes. You know, a speech and a couple tweets does not effectuate the policy. So we do have to see what the Commerce Department ultimately does here. I don't mean to hem and haw, but there's just - there are more facts that are going to have to develop here for me to get a true appreciation for what the implications are going to be.

MARTIN: That's Representative Ryan Costello. He represents the 6th District of Pennsylvania. We reached him in Chester County. Congressman, thanks so much for speaking with us.

COSTELLO: Thank you. Have a good day. Transcript provided by NPR, Copyright NPR.