As his final act as a federal lawmaker, Oregon Congressman Earl Blumenauer wants to pass a bill that would narrow a trade exemption he says China has exploited to feed the U.S. fentanyl crisis and undermine American jobs. 

Under the exemption, known as “de minimis,” foreign shipments worth less than $800 can enter the United States without import duties or taxes. Products under the de minimis threshold also require less paperwork and less stringent inspection than other imports. 

The de minimis rule has been in place since 1938 and was intended to make it easier for American shoppers to bring home small-ticket items after traveling abroad. But with the rise of online shopping and a recent increase to the dollar amount of the threshold, de minimis has exploded: In 2023, nearly 1 billion packages entered the United States using the exemption — a nearly 500% increase compared to 2015, when the threshold was just $200. 

U.S. Customs and Border Patrol can’t keep up with the flood of packages, so most de minimis shipments enter the country completely uninspected, Blumenauer said. Two-thirds of them come from China. 

“The idea was that it is a little tiny irritant if Aunt Nellie brings back leather shoes from Italy, but now this is used widely,” Blumenauer said. “None of us had a sense of how it would be exploited.” 

‘Loophole for fentanyl’

In April, Blumenauer hosted a press conference in Portland to talk about the drawbacks of de minimis. At the event, Hillsboro resident Jackie Thomas shared a teary story about losing her son, Jacob, to fentanyl poisoning in 2020. The drugs that killed her son most likely came from China, the world’s primary source for fentanyl and fentanyl ingredients, according to a February report by the Congressional Research Service. (Fentanyl is an opioid that is cheaper to make and stronger than heroin. It can be deadly in doses as small as 10 grains of table salt, and it’s responsible for a steep increase in drug overdose deaths in the last decade.) Blumenauer said it’s extremely likely that fentanyl suppliers in China are using the de minimis rule to traffic the drugs by mail.

“It can be shipped directly to the drug dealers’ homes, untaxed and uninspected,” he said. “Talk about convenience.” 

Exactly how much fentanyl enters the United States under de minimis remains unknown. Customs seized about 115,000 de minimis shipments in 2021, about half of which contained some kind of narcotic. But the seizures accounted for about one in 10,000 all packages that entered the country using the exemption. 

Thomas, who is also a member of the Lost Voices of Fentanyl advocacy group, says she wants lawmakers to close the de minimis loophole so other families don’t have to suffer the same pain hers did. 

“When I go to the airport, my carry-on is inspected, I’m inspected. … So why is all this cargo coming in without going through what we go through?” Thomas said. “Fentanyl needs to stop coming into the U.S. of A.” 

Bad for jobs

De minimis can be harmful even when the cargo is technically legal. Bill Amos, founder of Northwest Alpine, said his outdoor clothing company saw a boom of business in 2020 when it started making personal protective equipment (PPE) amidst the COVID pandemic. At its height, his garment factory in Salem employed 75 workers. 

Then China started exporting its own PPE at lower prices, undercutting Amos’ American-made products.. 

Oregon AFL-CIO President Graham Trainor says he’s talked to union members who worry about what de minimis means for them. For instance, United Steelworkers represents manufacturing employees who make tires, glass, and metals. One Oregon steelworker told Trainor about a Chinese company that sells cheap tires via Amazon. A set of four runs about $400, so it can ship using de minimis to avoid import taxes. It’s difficult for American companies with union workers to compete with that, Trainor said.

U.S. trade policy does include provisions to prevent some foreign imports from undermining American business. For example, imports of goods made with forced labor are not allowed. And Congress in 2021 passed a law that bans import of most goods from Xinjiang, China, where businesses rely on forced labor of the Uyghur minority group. But de minimis offers a way to get around the ban: Send the cheap clothing directly to customers, in a package that won’t be inspected or taxed. In 2022, Bloomberg reported that clothing from the online Chinese clothing seller Shein — which accounts for about 30% of the de minimis packages — were made with Xinjiang cotton. 

Re-minimizing de minimis

Last year, Blumenauer introduced the Import Security and Fairness Act (HR 4148), a bill to prohibit China from using de minimis and require Customs to collect more information on all de minimis shipments. The bill is a standalone version of similar provisions that were removed from the CHIPS Act, a package of subsidies to boost American semiconductor manufacturing. Blumenauer says it’s his top priority to get it passed before he leaves office. (He is not running for re-election, so this is his last year in Congress.) 

The bill is cosponsored by nine Republicans and eight Democrats, including Washington Republican Dan Newhouse and Oregon Democrat Val Hoyle. 

“This is a chance for us to take a step back and look at a flawed policy that is putting American families at risk and undercutting American business,” Blumenauer said. “It is one of few things in a dysfunctional Congress we ought to be able to get across the finish line.” 

Blumenauer told the Labor Press that he sees the bill as a chance to correct his previous decision in 2015 to support raising the de minimis threshold from $200. He said he never anticipated the exemption would be used to traffic drugs and outcompete American business. 

He’s also part of the Coalition to Close the De Minimis Loophole, a group that includes the national AFL-CIO, United Steelworkers, SEIU, National Association of Police Organizations, and Alliance for American Manufacturing. 

Blumenauer’s record on trade policy

From the AFL-CIO’s standpoint, Earl Blumenauer has had a mixed record when it comes to trade policy votes. Since the 1990s, organized labor has opposed international trade agreements like NAFTA with Mexico and Canada that make it easier for corporations to produce goods overseas and sell them into the U.S. market. Blumenauer was one of a minority of Democrats who joined the majority of Republicans to pass permanent normal trade relations with China in 2000. That cleared the way for China to join the World Trade Organization and was followed by an increase in the U.S. trade deficit with China. Blumenauer also voted for NAFTA-style trade agreements with Chile, Singapore, Australia, Morocco, Peru, Panama, and Korea. And he voted for the bill that increased the de minimis threshold from $200 to $800. But Blumenauer also voted against a regional free trade agreement with the Dominican Republic and five Central American nations, and against NAFTA-style deals with Oman and Colombia. And he voted, along with nearly every other Congressperson, for the bill blocking Chinese goods made with forced labor.