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Permanent duties on Canadian groundwood paper could literally stop the presses

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Sen. Chuck Schumer
July 23, 2018 06:09 pm

Community-oriented newspapers have long been the lifeblood of small towns and cities across Upstate New York. From them, we get local and national news, opinions, youth and high school sports and a reflection of who we are in the unique places we live.

They are fundamental to an informed citizenry, community identity and a vibrant democracy, yet, due to the meteoric rise of digital media, they are teetering on the brink of extinction.

And now, an unwise and unjust tariff that would hammer a main newsprint ingredient — specialty paper from Canada — threatens to push many local papers over the cliff. The administration is considering moving forward with a permanent tariff on this Canadian paper. In my judgment, this would be a poorly-thought-through decision that would do irreversible harm to an invaluable American industry and should be rejected by Commerce Secretary Wilbur Ross — something I have expressed directly to him on a recent call.

In this brutally competitive media landscape, our community papers already operate on razor-thin margins. However, the U.S. Commerce Department, at the behest of one company in Washington state — Northern Pacific Paper Corp., owned by a Wall Street firm — is instead considering the permanent imposition of a substantial tariff on this specialty paper; a tariff that would have massive negative impacts across the whole American newsprint industry and its local supply chain.

There is no domestic producer of this specialty paper in the Northeast or Midwest and the product is expensive to ship, which has forced struggling Upstate New York newspapers to import this specialty paper. Imposing tariffs will not help producers here, but it will drive up the cost of this vital ingredient for struggling papers and the whole supply chain, forcing the loss of both American jobs and local papers.

Tariffs can be very useful tools to level the playing field for American business and safeguard jobs. That is why I have often supported tariffs — especially when targeted at rapacious trade cheaters, like China, whose predatory policies kill American jobs.

But the punishment must fit the offense, and the tariff must level the playing field for American workers, and in this case, this tariff fails both standards.

First, the troubles of the Washington paper company were caused by the shift to digital media — not by heavy subsidies from Canada, as they claim. Second, the proposed tariffs will actually kill American jobs all along the supply chain. That is why they are vehemently opposed by U.S. producers of newsprint and the American Forest and Paper Association, which represents 80 percent of U.S. paper manufacturers.

Consider the impact on Quad Graphics, which employs some 850 people in Saratoga — a company I just visited that makes paper inserts. Permanent tariffs would cost them $90 million annually, meaning higher costs and fewer workers. In Upstate New York, we need every job we can get and putting them at risk with bad policy just makes no sense.

The impact of permanent tariffs on our struggling newspaper industry would be even more severe: Costs would stay high, causing subscription prices to rise, pages or journalists to be cut and yet more precious customers to fall away. Papers would fold, jobs would melt away and vital source of journalism and community identity would permanently vanish.

I have heard from a number of newspapers that are already cutting back, as these tariffs have already increased prices of newsprint by 24 percent to 28 percent in the region this year alone.

Our trade laws are there to level the playing field for American workers, broadly, not to do the bidding of one investment firm. I urge the Commerce Department to make the wise and well-grounded decision not to permanently impose these tariffs and duties and instead to support our plucky and vital American newspaper industry.

U.S. Sen. Chuck Schumer, D-NY, has represented the state in the U.S. Senate since 1999. He has served as the Senate Minority Leader since 2017.