This is a rush transcript from "Your World," March 1, 2018. This copy may not be in its final form and may be updated.
NEIL CAVUTO, "YOUR WORLD" HOST: We will definitely be also this weekend bringing up this particular issue, a big market sell-off on a possible trade war.
The markets don't like what they fear could be a tit for tat on these protections for steel industry, something I want to raise right now with Texas Republican Congressman, more importantly chairman of the House Ways and Means Committee, Kevin Brady.
Chairman, very good to have you.
We're getting different reports from different folks how maybe sympathize with the steel CEOs and their problems, but, for example, the Business Roundtable is aghast at this, saying "Strongly disagrees with today's announcement because it will hurt the U.S. economy and American companies, workers and consumers, by raising prices and resulting in foreign retaliation against U.S. exports."
Apparently, Speaker Paul Ryan's office feeling much the same way, that the president will consider the unintended consequences of this idea and maybe look at other approaches before moving forward.
Many, many others of that similar mind-set.
What do you think?
REP. KEVIN BRADY, R-TEXAS: Yes, so look, here's the good news. Thanks to President Trump's tax cuts, we have got an energized economy.
And our businesses have one of the more competitive tax codes in the world. He's right. The president has tried to target unfairly traded steel and aluminum.
But blanket tariffs that sweep in fairly traded products can backfire. They can actually hurt American jobs and workers. That's where I think we're all urging the president, look, continue to narrow this to these unfairly targeted products. Exempt those that are fairly traded. And there are a lot of these, because we have a complicated economy.
Not all steel products are interchangeable. And we want to make sure, for example, in Texas, I worry about our pipelines and that steel, fairly traded, but that could harm the very pipelines that are bringing American energy to our refineries around the world. And I worry about our Texas manufacturing plants that again are manufacturing for that same energy industry.
I know the president is strongly guarding our American energy workers, wants to do right by them. We got to make sure this is done right and targeted narrowly.
CAVUTO: Well, maybe he doesn't know, right, Chairman? Maybe he doesn't know.
But I know where his heart is and all of that. He doesn't like any industry being treated unfairly or steel being dumped here. But already, when I talk about those unintended consequences, Chairman, Canada is irate, saying it will take responsive measures to defend its trade interests and workers.
I suspect we will hear similar sentiment. But this now follows on the president looking to do this against solar panel makes largely from China, washing machines coming largely from South Korea. And the list seems to be growing. Are you worried?
BRADY: Well, look, you don't want to set off a trade war. And I think the more surgical you are in targeting these unfairly traded products, the better it is.
Look, there is major problems with China's overcapacity. There's some other issues the president is right to deal with. But you want to make sure this doesn't backfire on U.S. workers. That's why, again, the president has not yet issued these tariffs. He's continued -- he's been continuing to listen.
What I'm urging him to do is narrow this. Make sure you're exempting fairly traded products. Grandfather existing contracts, so there's no disruption.
CAVUTO: What does that mean, Congressman? You're talking about different blends of steels that we don't -- that we don't make, that we can only get from abroad, because that -- if you slap that on those things, then there's no alternatives for Americans. Right?
BRADY: Well, in the cases, for example, here in Texas, we sell -- send steel pellets from Corpus Christi to Austria. They're finely tuned and manufactured there, sent back to Navasota, Texas, where hundreds of my workers manufacture even further into some of best tubing for our energy industry.
Those are all American jobs, except for one action. We want to make sure these fairly traded products are not caught up in this blanket tariff.
And, again, tariffs are taxes. So, lower is always better. Zero is the best. And so you want to make sure this is done right.
CAVUTO: You mentioned tax cuts. I was saying, here you had these big old tax cuts. I know you're leading a push to make those tax cuts permanent for individuals.
CAVUTO: They're presently only that way for corporations. And in the middle of this comes something that could be a significant tax and gets to be a bigger tax on Americans, offsetting all the hard work that you put into this.
What do you think?
BRADY: Well, we want to build off the momentum of these tax cuts. Energize the economy. We want more customers. That's critical.
That's why these trade agreements, a modernized NAFTA is so critical for us. I'm heading down, leading a delegation to the seventh round of NAFTA talks this weekend.
We want to help President Trump modernize this agreement and create more jobs for us.
CAVUTO: Does he want to abandon NAFTA outright? He's certainly threatened it.
BRADY: Yes, I don't believe so. I think he wants a better deal for America.
CAVUTO: Has he told you that?
BRADY: I think there's -- yes, I think there's some huge wins for the president and our economy in a new modern NAFTA. There's no doubt about it. That's why I'm getting engaged in this, to help deliver on that promise.
CAVUTO: I have heard from a lot of people, though, talk about the Business roundtable, sir, and on FOX Business, which, if you don't get, you should demand. But, of course, you do get it and you do demand it.
BRADY: I do get it, yes, sir.
CAVUTO: But one of the things that's come up repeatedly since this trade move is that this president isn't a free trade guy, that he's a protectionist and that, again, with his heart in the right place and for the right reason, he will risk doing a great deal of harm to the economy.
You say what?
BRADY: The president's focused on manufacturing in a major way, trade deficits in a major way, and he doesn't want to outsource more American jobs.
I think our tax cuts and new tax code go a long way toward solving a lot of that. I think modern, new agreements like with Mexico and Canada can go another long way in creating those jobs and getting us more customers.
CAVUTO: All right.
BRADY: So, there's some good work to be done here that can be awfully helpful.
Again, you always just want to avoid, in a complicated economy with complicated products, you don't want to do anything that backfires on us.
Well, Kevin Brady, whether people agree or disagree with you, there's no harder working man in Washington, D.C., the chairman of the House Ways and Means Committee.
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