Trump Spared Fishing Gear And Cement From His Canadian Trade War. Voters May Not Care.

President Donald Trump spared cement and fishing rod parts from his latest Canadian tariffs to ease pressure on battleground Republicans. Few of the president's allies think that will make voters forget about a painful trade war.

The president on Tuesday night announced plans to ban some Canadian dairy, motorcycles and alcohol products from the U.S. market to escalate his trade war with Ottawa. But in that same announcement, the White House included new tariff exemptions on a scattershot array of industrial goods — a bid to protect vulnerable Republicans and sensitive industries.

The exemptions cover road salt, heavily used in wintry states that border Canada, and imported cement that fuels northern construction projects. Fishing rod parts tied to manufacturers in Wisconsin and Iowa also got a reprieve, along with refined lead, electrical switchgear and paper products. Whiskey in containers larger than four liters are also exempt.

The carveouts caved to pressure from Republican lawmakers who have increasingly criticized the president’s trade war less than two months ahead of competitive races in November’s midterms. More than one GOP lawmaker contacted the U.S. trade representative directly in the days and weeks before Trump’s Tuesday tariff announcement to plead for concessions, according to two people close to the administration who were granted anonymity to discuss private deliberations.

Trump’s latest tariff exemptions amount to a tacit admission that his Canadian trade war could be a political liability heading into November — and represent an attempt to blunt the economic impact in the states and districts that could decide control of Congress. But sparing a handful of products won't offset the war’s broader damage, according to Republican strategists, pollsters and people close to the Trump administration who spoke to POLITICO.

“The Trump administration is in harm-reduction mode and is certainly thinking about the midterms,” said one former USTR official and GOP staffer who remains close to the Trump administration and was granted anonymity to speak candidly about the updates. “You cannot change voters’ views on tariffs with an eleventh-hour carveout that was developed without input from the industries affected.”

The administration protected road salt and cement from its latest tariff plans after Republican Sen. Susan Collins publicly pressed U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick for relief.

The carveouts give the vulnerable Maine Republican a concrete concession to tout on the campaign trail. But Collins stressed in a social media post on Tuesday that the “significant tariffs” that remain in place, including on forest products, will lead to higher costs for Mainers and uncertainty for businesses.

Whiskey carveouts serve two ends for the administration: rewarding Canadian brands that have moved their bottling operations stateside, and needling Ontario Premier Doug Ford, who has traded insults with Trump for months.

Exempting bulk whiskey imports and unlabeled spirits headed for U.S. facilities allows officials to preserve the incentive for brands like Crown Royal and Black Velvet — which have both moved bottling operations to the U.S. in recent years — to keep bottling in Alabama and Kentucky rather than move back across the border, according to an industry representative granted anonymity to discuss sectoral supply chains.

Ford was particularly put out when Crown Royal unveiled plans to shutter its Ontario bottling facility and move operations to the U.S., emptying a bottle of the whisky in front of reporters last year and urging Canadians to pivot to other Canadian whisky brands.

Fishing rod parts also escaped Trump’s recent round of tariffs, offering relief to an industry with a major presence in Wisconsin, South Carolina and Iowa.

Wisconsin is home to St. Croix Rod, South Carolina is the headquarters of fishing-tackle giant Pure Fishing, and Iowa is the birthplace of its Berkley brand. The latter two carveouts could carry particular political value for Republicans Darline Graham and Ashley Hinson, who are running for Senate in South Carolina and Iowa, respectively.

Sugar importers who have asked the administration for relief from other U.S. tariffs were meanwhile rewarded with a carveout for certain imports, according to one industry representative.

But the administration did not consult some of the country’s most affected industries or several large industry groups in the run-up to the announcement. Dairy was heavily represented among the products added to the list of goods hit with 50% U.S. tariffs, and several whey products were included in the import ban. Industry representatives said they were given no heads up or opportunity to weigh in on the import bans’ design.

“We haven't been consulted at all,” said Becky Rasdall Vargas, senior vice president for trade and workforce policy at the International Dairy Foods Association, which represents manufacturers and marketers. “It's been a fairly closed door exercise.”

The White House declined to answer questions about the midterm fallout in key states. The Office of the U.S. Trade Representative did not respond to a request for comment.

A senior administration official said Tuesday that the tariff revisions were aimed at minimizing supply chain disruption, focusing on goods where Canada accounts for little of U.S. imports or where domestic production can absorb the hit.

"The focus was on items where Canada had very low import penetration, or where the United States has a lot of domestic production, to really minimize the impact on supply chains here," said the official, who spoke to reporters on the condition of anonymity.

The official added that "over the past year and a half, the president has taken a lot more nuance when it comes to naturally occurring items or natural resources not available" domestically.

The trade war still tilts toward Democrats’ favor despite the exemptions, said Jon McHenry, a vice president at North Star Opinion Research Group whose firm worked on Florida Republican Gov. Ron DeSantis' 2018 gubernatorial campaign.

Carveouts for products like road salt and cement can help at the margin, particularly in close races like Michigan and Maine.

"Any adjustment that benefits Republicans should be helpful," McHenry said. But they don't change the underlying math. "It's much easier for Democrats to say, 'Oh, another trade war, this is driving up prices,' than it is for Republicans to say, 'We are protecting American jobs.'"

"It seems likely to put a little bit of a thumb on the scale to the advantage of Democrats, because trade wars tend to increase prices, and prices are high enough," McHenry said.

Others in the GOP’s orbit shared McHenry’s skepticism that narrow exemptions could outweigh the tariffs that remain and suggested that the administration may be underestimating how sensitive consumers are to price fluctuations.

"Having an exemption on one good does not mitigate the fact that they're getting hammered with tariffs on a number of other goods that they love," said Brian Darling, a lobbyist who previously worked for Sen. Rand Paul.