America’s National Security at Risk Because of Unprecedented Steel Surge

New Paper Outlines Need for Stronger Trade Enforcement

Urgent action is needed to avoid U.S. military dependence on foreign steel from China and Russia, according to a new paper released by the Alliance for American Manufacturing (AAM).

The paper, “Steel Import Surge Threatens U.S. National Security,” was published Thursday amid national discussions surrounding the state of the domestic steel sector and the harm being done by China’s steelmaking overcapacity and unfair trade practices.

“This week’s USTR and Congressional Steel Caucus hearings have shown that American steel is vital to our country’s economy, infrastructure and national defense,” said Scott Paul, president of the Alliance for American Manufacturing. “If policymakers are looking for ways to provide good-paying jobs while protecting our country, they need to acknowledge the impact China’s overcapacity has had on U.S. steelmakers – and they need to enforce fair trade laws.”

Steel is essential to national security, as it equips the military and builds infrastructure. But massive oversupply of steel being dumped into the world market is creating an alarming import surge in the United States, according to the report. This overlooked threat poses new national security vulnerabilities, as the United States may be forced to rely on potentially hostile foreign governments like China or Russia to equip our military or respond to an emergency.

Congressional Steel Caucus leaders commented on the report’s findings as they were prepared to launch a Capitol Hill hearing on the state of the domestic steel industry.

“The steel import crisis is not only thrashing our economy and upending the job market, it is a direct hit to our national security. We can never fall into a position of relying on foreign government-owned enterprises to meet American steel needs,” said Steel Caucus Chairman Rep. Tim Murphy (R-Pa.). “The Congressional Steel Caucus achieved historic legislative victories in recent months but we can’t rest on our laurels, we must eliminate subsidized foreign steel imports flooding the markets.”

“Steel from Northwest Indiana and across America is used in our aircraft carriers, armor plate, submarines, and countless other types of military vehicles and equipment,” said Rep. Peter Visclosky (D-Ind.), vice chairman of the Congressional Steel Caucus. “As the Ranking Member of the House Appropriations Subcommittee on Defense, I can attest that steel is an essential component of our national security.”

Without strong trade enforcement and a meaningful solution to address global steel overcapacity, America’s steel companies and workers will continue to experience plant closures and layoffs. The report identifies a set of critical action items for policymakers in Washington, DC, including:

  • Proactive use of our trade enforcement laws;
  • Securing binding commitments from our trading partners to reduce global overcapacity;
  • Maintaining China’s nonmarket economy status;
  • Implementing rules to counter anticompetitive behavior of state-owned entities; and
  • Domestic content sourcing policies in government procurement.

The release of the AAM national security paper follows on two days of steel hearings at which Ambassador Michael Froman (USTR), Commerce Secretary Penny Pritzker and other top administration officials heard testimony from business leaders, workers, and other experts on ways to address the steel imports crisis and respond to China’s unfair trade practices more effectively.

The paper follows on the 2013 release of ReMaking American Security, authored by Brigadier General John Adams (U.S. Army, Retired), which documents a series of defense supply chain vulnerabilities that have fallen into the hands of China and other foreign nations.

“We cannot sit idly by as our most dangerous strategic competitors rob us of the capability that ensure our weapons and equipment have a reliable source of steel for the future,” Adams said of the updated paper. “The time is now to address this national security challenge to our domestic steel production capability.”

To access “Steel Import Surge Threatens U.S. National Security” visit: http://go.americanmanufacturing.org//page/file/a2f07fbe82f14e4b8c_xtm6bvc5c.pdf