America's economy is stagnant and showing few signs of growth. The private sector is being strangled by government regulation, an overly-complex and uncompetitive tax code, and uncertainty generated by the threat of tax increases, an onerous health care law, and the ever expanding national debt.
One of the bright stars, though, remains our ag economy, driven by expanded trade and finding new markets abroad for Nebraska products. As an advocate of increased international trade and a member of the Ways and Means Subcommittee on Trade, I am committed to reducing taxes and tariffs to increase trade and American competitiveness in a global economy.
In the past, Congress acted to close our borders, believing doing so would protect U.S. manufacturing and producers. Multinational manufacturing and international supply chains have evolved, though, and we now know free and fair trade is economically advantageous for America and Nebraska.
To keep pace with our international competition, Congress developed the Miscellaneous Tariff Bill (MTB) to temporarily suspend previously levied import taxes on necessary manufacturing inputs which are not sold or available in the U.S. Suspending these tariffs reduces the cost of U.S. manufactured goods, making them more affordable and attractive to domestic and international consumers.
The reduced cost of production benefits consumers both here and abroad, protecting jobs at home and reducing our trade deficit. The largest category of goods imported into the United States is not consumer goods, but capital goods used to create value-added finished products. For example, Nebraska manufacturers import raw materials not found in the U.S., and then export their manufactured products to consumers around the world, benefiting our local economy.
The MTB process also fosters more competition between domestic producers because prohibitive tariffs can prevent smaller start-up businesses from gaining a foothold in an industry.
The MTB supports an estimated 90,000 jobs, increases U.S. production by $4.6 billion and expands U.S. GDP by $3.5 billion. Congress must renew the MTB by the end of this year to expand opportunities for U.S. manufacturers to benefit from suspended duties on imports. Failure to act only benefits foreign manufacturers who do not face the same punitive tariffs.
In the past, the duty suspension process has been conducted with little transparency, raising concerns the bill could be open to earmarks or limited tariff benefits to a single entity. However, I have supported an updated process developed in the Ways and Means Committee to increase transparency and ensure the MTB is in accordance with House Rules and the earmark moratorium.
The MTB provisions now are fully vetted by the public, the independent International Trade Commission and the Executive Branch before being included in the final bill. The additional steps ensure the proposed tariff suspension would not be limited to a few entities, but instead available to anyone wishing to import the product.
Despite the unprecedented transparency of this process, some continue to call for Congress to cede this authority to the Executive Branch. Providing more unchecked authority to an already bloated Executive Branch, however, would be misguided. The MTB process promotes good government, allowing Congress to carry out its constitutional responsibility to "lay and collect taxes and duties," under Article I, Section 8 of the Constitution, while providing an open process for individuals to submit public comments.
Given the weak state of our economy, Congress should use any and all means to reduce burdens imposed by government to encourage private sector growth and jobs. Congress can accomplish this goal in part by passing an MTB before the end of the year to give certainty to manufacturers and promote American exports and competitiveness.