Flood of Subsidized Foreign Imports Threatens Steel Workers’ Jobs

WASHINGTON– Crunch. In one word, that’s what U.S. steel workers and their employers face from a new flood of subsidized foreign imports, according to a comprehensive report from the Economic Policy Institute and two U.S. senators from steel-producing states, Ohio Democrat Sherrod Brown and Alabama Republican Jeff Sessions.

The solution?  Tougher enforcement of U.S. anti-dumping laws, including higher tariffs on the steel, especially from China, South Korea and India, they and the report say.
“This report should be a wake-up call to Congress and the Obama administration,” Steel Workers President Leo Gerard said after EPI released the study.  His union has led the way in pushing U.S. administrations of both parties into tougher enforcement of anti-dumping laws.
“The U.S. steel sector supports up to half a million U.S. jobs which are at risk without strong action against rising excess global capacity and a flood of unfairly-priced and traded steel imports swamping our market.  Our economic and national security interests are at risk and policy leaders appear to be sitting on their hands,” Gerard added.
“This report provides a detailed analysis of the problems we face. The time for dialogue is over; the time for action is here,” Gerard concluded.The senators, EPI and the pro-worker Alliance for American Manufacturing (AAM) called a May 13 telephone press conference to sound the alarm over the imports, particularly of pipe and tube steel to be used to pump the new reservoirs of oil and natural gas being discovered nationwide.”
Firms building those piping systems are looking for the lowest cost to buy their pipes, the two senators and EPI’s report says.  And that’s where the foreign subsidies come in.
Top foreign steel firms, half of them owned by national governments, are grabbing up to 40 percent of the U.S. pipe and tube market, they explained.  They can do so because they get subsidized low-interest loans, favorable land deals, breaks on transportation costs and other  aid.  That lets them undercut U.S. prices for pipe and tube and threaten U.S. steel jobs.
As a result, U.S. steel companies lost $388 million in 2012 and $1.4 billion last year, added EPI economist Robert Scott.  Subsidized imports cost 35,600 steel jobs and 136,200 indirect jobs in ancillary industries in the two years, EPI calculated.
“The last time we saw a scenario like this was the late 1990s” after Asian currencies crashed, said AAM Executive Director Scott Paul.  “And the results were ugly.”  More than two dozen U.S. steel firms went bankrupt, hundreds of thousands of workers lost well-paying jobs and the industry suffered massive capacity loss and consolidation.  That upsets the senators.
“We’re on the cusp of a manufacturing renaissance” with the U.S. having added 500,000 factory jobs in the last four years after losing 5 million in the decade before, Brown told reporters.  “Manufacturing drives our economy, but manufacturing can’t compete when the playing field is not level.”