Upstream Steel Industry Suppliers are Strengthening
President Bush's Steel Program is Lauded by the Chairman of the American
Steel Coalition as the Preserver of over 1.1 Million American Jobs
Washington— President Bush’s Steel Program
has helped to preserve more than 1.1 million jobs and it must be maintained
for the full three years intended, said Charles W. Connors, president
and CEO of Magneco-Metrel in Addison, Illinois, and chairman of the American
Steel Coalition, which represents small and medium-sized businesses who
support the 201 steel tariff remedy.
Connors said while it has been estimated that since
the tariffs, 16,000 steelworkers’ jobs have been restored at formerly
closed mills, little attention has been given to the significant volume
of upstream manufacturing companies that supply products and services
to the steel industry and whose viability depends on having a healthy
domestic steel industry. He said industry experts estimate these upstream
manufacturers employ in excess of 1.1 million people in this sector.
“My company, which is a steel industry supplier
and customer (employing 143 people in Illinois, northern Indiana and eastern
Ohio), came close to bankruptcy, losing $2 million in 2001 and $300,000
in January and February 2002. One more month with such losses and we would
have been out of business,” Connors said. He credits President Bush’s
Steel Program, launched in March of 2002, with the survival of his company
and thousands like it, and urges the President to keep the steel safeguard
in place until March of 2005 as promised.
University of Maryland Professor and former Director
of Economics for the U.S. International Trade Commission, Peter Morici,
said the tariffs are having their intended effect as U.S. steelmakers
are seizing on the three-year- program by revamping their operations to
“If you take away the tariffs now, a lot of the
progress that has been made will be dashed, and consuming industries will
be harmed,” Professor Morici said. “It is in the long term
best interests of steel consumers to have a healthy domestic steel industry.
Otherwise, ready availability of steel products at affordable prices,
as we now have, will not be the case.”
“ ... Overall imports of steel are up since the
tariffs were implemented and most steel prices are below 20-year averages,”
Senator Evan Bayh (D-Ind) said in recent testimony before the International
Trade Commission aimed at gauging impact of the steel tariffs. “Prices
in the U.S. market are below those in most other major steel markets.
These statistics are evidence that, however invaluable, the tariffs represent
a modest remedy for the industry. When you take all of these factors into
account, it is really remarkable what the industry has accomplished in
“President Bush warned steelmakers to restructure
or lose the tariffs. As a consequence of the stability created by the
tariffs, steelmaking assets were redeployed getting rid of burdensome
legacy costs and improving work rules and plant floor efficiency, thus
shifting the cost curve. Overall, the steel program benefited U.S. manufacturers
and saved jobs in the long run by ensuring a steady supply of steel made
at lower cost,” Morici said.
Despite what the critics have said, Connors insists
that maintaining the tariffs is the best way to ensure the health of the
domestic steel industry.
“Some users of steel products are clamoring to
have the Administration end the sanctions early, saying they’re
being hurt because they have to pay higher prices for raw materials,”
Connors said. “But the latest global pricing data reveals that U.S.
prices for domestic steel are among the lowest in the world.”