Heads up new story alert!! For nearly as long as the trade war has been going on, companies have been applying for exemptions from tariffs, in a process the government set up to ensure hefty duties don’t create too much collateral damage. 1/10
By now, the process has become a sprawling affair in which dozens of government workers with minimal training have made tens of thousands of decisions about which products to let off the hook — sometimes with drastic consequences for small businesses. 2/10
(I got USTR’s training manuals for people reviewing exclusions. One of them advises, “The internet is useful to research the product.” documentcloud.org/documents/6594… ) 3/10
It’s also skewed toward the wealthy and well-connected. Commerce’s IG found that steel producers exerted “improper influence” by objecting to exclusions, saying they could supply the steel in the US — claims that seem unrealistic given their total capacity. 4/10
That’s created a nice new line of business for K Street. Hundreds of companies have hired lawyers and lobbyists to make sure their requests are extensive and well-tailored and get due consideration. A call from a senator or a meeting with a WH official doesn’t hurt. 5/10
Companies that can’t afford to hire DC influencers do their best to navigate the process solo. It’s hard to know whether they would’ve succeeded with professional help — USTR doesn’t explain in detail why requests are denied or approved, it just sends a one page form letter. 6/10
I talked to dozens of these businesses, and spent time with one of them, Eccotemp. After a multinational competitor opposed their requests, the tariffs forced them to shelve growth plans, including new hires and a potential US assembly facility. 7/10
Eccotemp’s founder, Mike Elrod, is a libertarian and actually a fan of Donald Trump. But the tariffs are “just a crusher,” he says, and it bugs him that big companies are better equipped to avoid the tariffs. “You get the justice you pay for,” he says. 8/10
Anyway READ THE STORY: propublica.org/article/how-tr… 9/10
Also last thing: This process ain’t over. Exclusion requests are still rolling in, decisions are still being made, and I’ve still got FOIAs out, so there will be follow ups. If you’ve got anything relevant to share, hit me up: lydia.depillis@propublica.org 10/10
