June 22, 2018
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Lawmakers concerned over fate of tariff that could help New Balance in Maine

By Matthew Stone, BDN Staff

A pair of Maine legislators made an appeal to international trade negotiators in Virginia over the weekend to preserve a tariff on athletic footwear imports that makes it possible for footwear manufacturer New Balance to keep about 900 shoe manufacturing jobs in Maine.

But Democratic Reps. Sharon Treat and Jeff McCabe said Monday that they came out of their meetings in Leesburg, Va., concerned that negotiators working out the 11-nation Trans-Pacific Partnership free trade agreement are moving toward a deal that gradually phases out the duties.

McCabe, who lives in Skowhegan, delivered a presentation to trade negotiators about the effects of New Balance’s Skowhegan factory on his community as part of the negotiations’ Direct Stakeholder Engagement event. Representatives from more than 200 organizations attended the event as stakeholders wishing to speak with trade negotiators, according to the office of the U.S. Trade Representative.

McCabe also had a chance to ask negotiators about their discussions concerning the footwear tariffs. According to Treat, a U.S. negotiator said the American negotiating team is aware of concerns about lifting the footwear duty. New Zealand’s chief negotiator, David Walker, then said negotiators have discussed a transitional period during which the duties would be phased out, Treat and McCabe said.

“It’s clear for the jobs that exist in Maine and New England related to footwear,” McCabe said during a conference call with reporters, “they’re really in danger at this point.”

“We think it’s important that our negotiators pay close attention to how this agreement could impact our part of the world, the state of Maine, in a negative way,” said Treat, who lives in Hallowell. “The manufacturing base has been shrinking over the past number of decades and we want to make sure we maintain the jobs we have.”

McCabe, Treat and others could have another opportunity to make that appeal on Thursday, when U.S. Trade Representative Ron Kirk is scheduled to visit New Balance’s Norridgewock factory.

New Balance is the only major footwear manufacturer that still makes some of its products in the United States. The company operates three factories in Maine — in Norridgewock, Norway and Skowhegan — and two in Massachusetts.

The Trans-Pacific Partnership is a trade pact in the works that includes the United States and 10 other countries, including footwear-exporting Vietnam. As part of the trade agreement, Vietnamese negotiators have pressed the United States to remove a tariff on athletic footwear that New Balance says makes it financially viable to maintain manufacturing operations in the United States.

Matt LeBretton, New Balance’s director of public affairs, said Vietnam’s footwear manufacturing industry has grown steadily in recent years without eliminating the United States’ tariff on footwear imports.

“Our general state of mind is, we’re striving to do something differently because we think making things in the United States is important,” he said. “We hope that our government hears us when we say it’s crucial to maintain what is left of this domestic [manufacturing] base.”

LeBretton said New Balance officials on Thursday will encourage Kirk to speak with workers on the factory floor.

“We know how important he thinks free trade is,” LeBretton said. “We want him to understand how important fair trade is to people who make shoes in Maine in our factories.”

Official discussions surrounding the trade agreement are largely secret, Treat said, and U.S. negotiators didn’t offer many hints about whether they’ll push to preserve the athletic footwear tariff as negotiations continue.

Still, she said, it’s important to continue appealing to negotiators about it.

“Just by showing up here, we’re showing these negotiators that this matters a lot, and we’re showing our U.S. negotiators that this issue is not going away,” Treat said.

A spokesman for Kirk’s office didn’t return an email seeking comment on the footwear tariff.

In Maine, members of both parties have spoken up in support of preserving the athletic footwear tariff. All four members of Maine’s Congressional delegation — Democratic U.S. Reps. Mike Michaud and Chellie Pingree and Republican Sens. Olympia Snowe and Susan Collins — support the tariff.

In July, Michaud and Collins hosted a Capitol Hill press conference with New Balance officials where they argued against dropping tariffs through the proposed trade agreement. And Snowe and Michaud invited Kirk to visit one of New Balance’s Maine factories.

In Maine’s U.S. Senate race, independent former Gov. Angus King, Democratic state Sen. Cynthia Dill and Republican Charlie Summers, Maine’s Secretary of State, have said they support keeping the tariffs in place.

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