This Week in Washington
NCTO and Industry Leaders Ramp Up Lobbying Campaign to Elevate Industry & Shape Critical Trade Policies in Washington
By Kristi Ellis
Videos by: Rebecca Tantillo
This week in Washington, NCTO and textile industry leaders ramped up an aggressive lobbying campaign on Capitol Hill, engaging in high-level meetings with administration officials and members of Congress to educate leaders about the importance of the industry’s supply chain and to raise concerns about new penalty tariffs on our North American free trade agreement partners, the de minimis loophole, and predatory trade practices by China that are severely harming the industry.
In a key development, the industry notched a win with a one-month reprieve on tariffs on qualifying imported goods from Mexico and Canada under USMCA, as our organization’s robust lobbying campaign to preserve and expand the domestic supply chain and our Western Hemisphere coproduction chain kicked into high gear.
On the ground, NCTO President and CEO Kim Glas joined Parkdale Mills Chairman and CEO Andy Warlick. As part of this effort, they engaged in meetings with key lawmakers and White House officials, while staff and other industry leaders stepped up outreach to key allies to elevate the industry’s severe economic crisis and push for reforms to help bolster the industry. Key priorities include strongly preserving duty free treatment for qualified trade from our Western Hemisphere Free Trade Agreements. This message was clearly heard when the Trump Administration paused tariffs on qualified goods meeting the rules of origin for a month. NCTO is actively engaged in urging a quick resolution and market certainty on this critical trade. Closing de minimis, bolstering our domestic production base and Berry amendment, and stepping up customs enforcement were other key priorities reiterated.
In addition, there was a fly in effort held by USINFI which included some of our member companies – reiterating some of these same key points on Capitol Hill.
On Tuesday, Warlick participated in a press conference with Rep. Linda Sanchez (D-CA), the ranking member of the House Ways and Means Trade Subcommittee, who introduced the Closing the De Minimis Loophole Act, the most comprehensive bill to date aimed at closing a loophole that has “harmed American consumers and families and gutted U.S. manufacturing.
The bill would immediately end de minimis benefits for all goods from China and phase out those benefits for imports from other countries – a move that would go further than reforms floated by other lawmakers.
“With over four million packages arriving on our shores every day, meaningful enforcement of our laws is nearly impossible,” Sanchez said. “The de minimis provision has become a tool for illicit trade, especially from China. Whether it’s fentanyl and its precursors, or ghost guns and illegal silencers, cheap knock-off or unsafe toys made with lead, China remains the source of many harmful products entering our market.”
“But the problem isn’t just about China. It is about the loophole itself. We cannot keep responding with half measures or simply playing whack-a-mole with specific countries, she added.
Warlick painted in stark terms the impact of de minimis on the U.S. industry and on our North American trading partners.
“De minimis is severely impacting my company, U.S. textile and apparel manufacturers, brands and retailers, and our Western Hemisphere trading partners. I cannot emphasize enough the urgency to close the de minimis loophole,” he said.
The American textile industry has lost 27 plants in the last 20 months and the entire industry is facing severe economic decline, Warlick noted. This is an industry that makes lifesaving equipment for U.S. warfighters and critical PPE in times of crisis, particularly during the COVID crisis.
“We are without a doubt the industry most affected by de minimis—textile and apparel imports make up at least 50 percent of boxes and goods coming in daily into this country and they are coming in duty free, undercutting textile and apparel manufacturer.”
He added that these much-needed jobs in rural areas of the country are being “destroyed” by de minimis and called on lawmakers on both sides of the aisle to support reform and Rep. Sanchez’s legislation.
See his remarks here:
In addition, members of the Coalition to Close the De Minimis Loophole, which is spearheaded by NCTO, spoke at the press conference. The coalition is comprised of business groups, law enforcement, fentanyl family victim groups, labor groups, unions and other nonprofits, who are working hard to amplify the urgent need for the administration and Congress to close this deadly loophole in U.S. trade law NOW.
Andy Edmiston, director of government affairs for the National Association of Police Organizations (NAPO) outlined the impact the loophole has had on law enforcement efforts to combat the opioid and fentanyl crisis.
“We view closing this trade loophole as a vital part of any national strategy to stop the spread of fentanyl, which is devastating to our communities,” Edmiston said.
See her remarks here:
The following day, Warlick addressed rampant international trade fraud that is also undermining the U.S. textile industry and manufacturing sector as a whole.
He spoke at a press conference hosted by Chairman John Moolenaar (R-MI) and Ranking Member Raja Krishnamoorthi (D-IL) of the Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party (CCP), in partnership with the Coalition for a Prosperous America (CPA) and Rep. Ashley Hinson (R-IA).
The press conference highlighted China’s unfair trade practices, including intellectual property theft, trade fraud, and the circumvention of U.S. tariffs.
“A strong American textile industry is vital for the integrity of our national security supply chains. Without the U.S. textile industry, the men and women of our armed forces could be stuck in gear and uniforms made in China,” Warlick said.
“Bad actors, often backed by their governments, have become experts at identifying weaknesses in our trade laws and they exploit these weaknesses through several different mechanisms.
For example, while imports of textile and apparel from Asia increased approximately 60 percent in recent years the duties being collected have remained flat despite additional penalty tariffs put in place during that period of time, he added.
“The discrepancy speaks to widespread customs fraud designed to deny our government its rightful revenue, shutter our factories and put Americans out of work,” Warlick added.
“We desperately need a dedicated, coordinated U.S. government effort to investigate and prosecute predatory trade violators. Until that happens, bad actors will continue to become more brazen and crimes like misclassification, transshipment and undervaluation will become increasingly routine rather than rare. This is an area where crime pays,” he said.
View his remarks here:
Given the velocity of trade issues impacting the industry, we look forward to seeing you in Washington, D.C. for our annual meeting at the end of March as we intensify our lobbying efforts. In addition, we will be reaching out to our full membership to step up engagement with key decision makers during this unprecedented time. Thanks for your support!
