What is the Trade Act of 1974?
The Trade Act of 1974 is part of a law passed by the US Parliament to increase US participation in international trade and reduce trade disputes. The law was enacted on January 3, 1975. The law provided the authority to reduce or eliminate trade barriers and improve relations with non-market communist and developing countries. In addition, the law wanted to change the harmful and unfair competition law.
- The Trade Act of 1974 is a law passed by Congress to increase US participation in international trade and reduce trade disputes.
- The law provided relief to American industry that was adversely affected by increased international trade and imposed tariffs on imports from developing countries.
- It has opened up overseas markets for US exports.
- It created a swift authority for the president to negotiate trade agreements. Congress may approve or disapprove it, but it cannot amend or interfere with the proceedings.
Understanding the Trade Act of 1974
The law provided relief to American industries that were adversely affected by increased international trade and imposed tariffs on imports from developing countries. It also stipulated US actions against foreign countries where import activities are unfairly disadvantaged to US labor and industry.
In retrospect, the Trade Act of 1974 and subsequent iterations have been used to open foreign markets to US exports and investments, rather than to protect US industry from unfair external competition.
International trade has long been a controversial political and economic issue. Opponents claim that it robs domestic workers of their jobs. Proponents say that while international trade may force domestic workers to move to other occupations, free trade maximizes specialization and division of labor to improve the economic situation of all participating countries. I argue that it is.
The intended purpose of the Trade Act of 1974 was to promote the development of an open, non-discriminatory and fair world economic system. A fair global system will stimulate fair and free competition between the United States and foreign countries. It was also aimed at promoting economic growth and full employment in the United States.
Article 2 of the US Constitution is interpreted as empowering the President to implement foreign policy. However, Articles 1 and 8 impose obligations on Parliament to collect and authorize foreign commerce.
Therefore, the ability to control trade with other countries must be delegated to the President by Parliament. The Trade Act of 1974 empowered the president to engage in trade negotiations, but Congress restricted the president’s jurisdiction by requiring a decision to not endanger national security and promote the purpose of the law. bottom.
Changes in the world economy, where the American trade law was enacted, led to the creation of this law.
Commercial Code Fast Track
The Trade Act of 1974 created the President’s Trade Promotion Authority to negotiate trade agreements that Congress may approve or disapprove, but cannot amend or filibuster. The trade promotion authority established under the law was scheduled to expire in 1980. However, it was extended again in 1988 for eight years in 1979. The extension of 1988 was until 1993 to allow negotiations on the Uruguay Round within the framework of the General Agreement on Tariffs and Trade (GATT).
The law received another extension in April 1994, the day after the Uruguay Round ended, as the Marrakech Agreement changed GATT into the World Trade Organization (WTO). The trade law of 2002 has revived the fast track. The Obama administration also called for a renewal of its trade promotion authority in 2012.
An example of the Trade Act of 1974
The Trade Act of 1974 was recently enacted by former President Trump for a trade war with China and other countries where the United States imports goods. The Bureau of Foreign Trade has stated the following about Section 301 of the Trade Act:
“Section 301 of the Trade Act of 1974 empowers the United States to enforce trade agreements, resolve trade disputes, and open foreign markets to US goods and services. It imposes trade sanctions on the United States. It is the main statutory authority that can be imposed on foreign countries that violate trade agreements or engage in other unfair trade practices. If negotiations to remove the violating trade practices fail, the United States will We may take steps to raise the import tax on foreign products as a means of rebalancing lost concessions. “
As reported by the Cato Institute, in 2018, former President Trump used Article 232 of the Trade Expansion Act of 1962 to impose a trade penalty on imported steel products. The imposition of additional tariffs occurred without parliamentary approval. The think tank cites the invocation of his Article 301.
“”[T]he [Trump] The government has announced tariffs on $ 50 billion worth of imports from China on suspicion of unfair practices such as forced technology transfers and theft of intellectual property. When Beijing retaliated against US tariffs on agricultural products, Trump announced that he would be importing another $ 200 billion from China with tariffs. “