The South Carolina Congressional delegation could be heading towards a showdown with President Donald Trump over a proposal to impose harsh penalties on Samsung, a South Korean manufacturing giant preparing to open a new job-generating home appliance plant in the Palmetto State.
The International Trade Commission voted Tuesday to recommend slapping Samsung with three years of tariffs on imports of large residential washing machines exceeding 1.2 million units, punishment for the company’s alleged squashing of domestic competitor Whirlpool.
The ITC recommended a 50 percent tariff the first year, followed by 45 percent and 40 percent in the second and third years. Two of the four commissioners separately recommended a 20 percent tariff on Samsung if it imports less than 1.2 million units.
The ITC will formally transmit its recommendations to the White House by Dec. 4. Trump can then begin his deliberations. He does not have a deadline and can choose to do nothing.
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Members of the South Carolina delegation fear that if Trump agrees with the ITC, Samsung will be compelled to shutter its Newberry operation before it even opens, risking nearly 1,000 local jobs.
Rep. Ralph Norman, the Republican whose district includes the forthcoming plant, told McClatchy on Tuesday he was “furious” with the ITC’s recommendation and planned to “get a group together to go to the president” to oppose the actions.
“What message does that send to businesses looking to come in to do business in the United States?” he asked. “I’m really disappointed. This government should not be picking winners and losers, and that is exactly what they’re trying to do in this ruling.”
Norman testified before the ITC in Washington last month, along with South Carolina GOP Gov. Henry McMaster. They urged leniency as the four-member board weighed a remedy for its earlier determination that Samsung was, in fact, at fault in violating so-called anti-dumping regulations by producing its washing machines overseas and importing them to the U.S. to sell at cheaper prices than Whirlpool.
Both officials argued that while the Samsung plant had an international owner, it was proving itself committed to investing in the United States by expanding production inside the country, notably in South Carolina.
“The commission’s actions today could chill a community and manufacturing success story before it gets a chance to take off,” McMaster told ITC commissioners. “South Carolinians want and need this facility to be successful, and this case, as you know, threatens this outcome.”
In letters submitted to the ITC on Monday, delegation heavyweights Sen. Tim Scott, R-S.C., and Assistant House Democratic Leader Jim Clyburn, D-S.C., made similar pleas.
“I fear that unless the commission exercises restraint in the remedy phase of this proceeding, a number of serious, unintended consequences would emerge, harming consumer choice and innovating and disrupting investment, manufacturing and economic growth in the state I represent,” Scott wrote.
Clyburn described the Newberry plant as “precisely the type of investment that we as policymakers should encourage with our trade policies.
“The factory is expected to open soon, and I understand several of my constituents have already been hired,” he continued. “Thus, Samsung is already a part of our community in South Carolina. This facility and its employees are also now a part of the domestic appliance manufacturing sector, and it is important that the commission protect these workers as well as other interests.”
Norman, along with fellow South Carolina GOP Reps. Joe Wilson and Jeff Duncan, also sent a letter Monday urging the ITC to be lenient in its ruling. Republicans in the Texas and New Jersey Congressional delegations, which have Samsung operations in their home states as well, signed on too.
In a statement Tuesday, Whirlpool reiterated a talking point that a ruling in its favor will help bring more manufacturing to South Carolina than if Samsung were allowed to continue its practices.
Under ordinary circumstances, Trump’s decision would be easy: Enforce the penalties. He has made “make American manufacturing great again” a hallmark of his campaign and his presidency and is now exploring re-negotiating existing trade deals such as NAFTA.
But just last month, Trump was in South Carolina campaigning for McMaster and praising Samsung, even hobnobbing at one point with senior members of the company at the governor’s reelection fundraiser. Trump owes McMaster for giving him his endorsement in the days before the pivotal “First in the South” presidential primary last year. The argument that the Newberry plant would create local jobs might also resonate with the president.
Samsung appeared to be holding back some of its ire on Tuesday. In a statement, a company spokesperson said the ITC “appropriately rejected Whirlpool’s outrageous” bid that Samsung be beholden to 50 percent tariffs on all washing machine imports, below or above the 1.2 million level.
The spokesperson added, however, that “any tariff would raise prices, provide fewer product choices and impair job creation at our South Carolina factory.”