Manufacture This

The blog of the Alliance for American Manufacturing

The tariff exclusion process shouldn’t undermine relief for America’s steel communities.

There’s a whole lot of discussion these days about the Trump administration’s trade policies, particularly when it comes to tariffs.

Criticism of the tariffs dominates much of that debate, but what often gets lost is recognition that workers across the country have long been hurt by China’s unfair trade practices, including the 15,000 steelworkers who found themselves in the unemployment line because of China’s massive unchecked global steel overcapacity.

And those are the people who Roy Houseman urged Congress to remember when he testified before a House Ways and Means subcommittee on Tuesday.

Houseman, who works for the United Steelworkers, told committee members that the Section 232 tariffs on steel and aluminum are creating thousands of good-paying union jobs while also protecting these critical industries, which supply our defense and critical infrastructure.

Indeed, nearly 7,000 direct jobs have been created since the 232 investigations began in April 2017, with “tens of thousands of additional, indirect jobs resulting,” Houseman testified.

“It is good to hear from local union leaders like James Sanderson at USW local union 7898 in Georgetown, South Carolina. After a three-year idle, their wire rod facility is restarting, putting 125 workers back to work immediately… as orders rise, the company says another 195 people will be hired at the mill,” Houseman said.

“The same goes for Dan Simmons at USW local union 1899 in Granite City, Ill. After over two years, their facility is in the process of restarting both of their basic oxygen furnaces with 800 union members getting recalled and bringing close to 3 million tons of additional slab capacity for the domestic market.”

Houseman noted many of these workers spent years struggling because of the steel imports crisis, which stems from China’s government-subsidized industry. China’s state-run steel companies make way more steel than they need, price it below fair market value and flood the global market.

Years of talks with China have yielded little results. China repeatedly promised to make less steel — and repeatedly broke those promises.

"These are local leaders striving to do the best for their communities and membership. They want to ensure we produce the steel and aluminum products this country needs to supply our defense and critical infrastructure needs while being commercially competitive." Roy Houseman, United Steelworkers

In response, the U.S. issued a series of tariffs on specific imports from China. But China found ways around the tariffs and continued to flood the global market. The crisis continued. And in places like Georgetown and Granite City, people struggled.

The Trump administration’s decision to issue tariffs on imported steel and aluminum was designed to be a wider-reaching response to China’s overcapacity, and have helped stabilize the American industry.

The administration also allowed companies who depend on imports of steel products that cannot be adequately produced in the United States to apply for exclusions from the tariffs — and that process was the focus of the subcommittee hearing on Tuesday.

Houseman noted that while these businesses deserve sympathy as they go through the bureaucratic exclusion process, it’s unfair to say that “unilateral action to protect American industry from global overcapacity is a bridge too far.” After all, those workers in places like Georgetown and Granite City know what that’s like first hand.

“I highlight these sites because the union also helped draft and secure their Trade Adjustment Assistance petitions not that long ago when they were idled, submitting them into a bureaucratic process that often takes months, but can even go years to work through,” Houseman said. “And, as a TAA recipient myself, I know the pain and uncertainty they have experienced.”

Houseman said the union does not object to waivers “where products to meet our nation’s needs are truly unavailable.”

“Our members not only produce steel, but they are also users of that steel in fabrication and other downstream facilities,” he added.

But Houseman also noted that any efforts to undermine the steel and aluminum industries in the process and allow imports to “wash away our members’ jobs and devastate communities is not a solution.”

“We will be the first to agree that the process must improve, but the union also cautions against efforts to undermine 232 tariff relief,” he said. 

Watch Houseman's testimony below: