On Trade, It Ain’t Over Till It’s Over…And Sometimes Not Even Then

When it comes to enforcing trade rules against subsidized foreign imports, keep in mind the quote from that great sage, Yogi Berra: “It ain’t over till it’s over.”

And sometimes not even then.

The Yogi comparison comes up in a trade case the Steel Workers took before federal officials, challenging imported tubular pipe from Korea and eight other countries.  But it can happen in virtually any trade case where subsidized imports damage U.S. firms and jobs.

The pipe is frequently used for tubes for oil lines, but it’s also used for fence posts, conduits, tubing for fiber optic cables, and more.  That pipe is a big Steel Workers product.

But U.S. firms don’t have the capacity to produce all 100 million tons of pipe – formally called oil country tubular goods – the nation needs each year.  They produce 80 million tons.

So other nations, led by Korea and China, rush in with their own subsidized pipe to try to grab our OCTG pipe market, and our high-paying, union-represented, pipe-making jobs.

Protecting the jobs and the market leads the union into the trade cases.  The Steel Workers lead the league – and not just labor’s league – in filing them, defending U.S. workers.

In early July, in a decision the Steel Workers cheered, the Commerce Department’s International Trade Administration ruled that Korea and the other nations dump OCTG pipe on the U.S. market.  It proposed tariffs and duties to counteract the foreign subsidies and the foreign governments’ aid to their pipemakers.  (Commerce ruled on Chinese dumping before.)

ITA’s decision was only the first step.  On July 15, the U.S. International Trade Commission heard the case.  It will decide to accept or reject Commerce’s recommendations.

That led USW President Leo Gerard to the commission’s hearing, with bad news.

“Between the first quarter of 2013 and first quarter of 2014 hours worked increased by 1.4%” in U.S. firms that produce OCTG pipe “while consumption increased by 13.6%,” he told the panel.  “Why?  Because despite massive investments in new capacity several years ago, the U.S. industry is losing market share to dumped imports.

“Our members and our industry are not getting their fair share of the work this demand represents.”  As a matter of fact, at least 345 union workers have already lost their jobs due to the imports, mills have shut and other workers saw their hours slashed, he testified.

“This is shocking during a period of increasing demand.  Therefore, the industry and our members are not sharing in this domestic boom in energy exploration” where OCTG pipe can be used for more natural gas lines and wells, for example, Gerard said.

The commission will take until September for a decision, but regardless of which way it rules, it’s not the last word.

Democratic President Barack Obama could overrule the commission – even if the panel decides the dumping justifies the tariffs and other curbs on OCTG imports.  Just over a decade ago, for example, Republican President George W. Bush imposed three years worth of tariffs on dumped foreign steel, but he had modified the commission’s initial ruling.

And even Obama might not be the last word.  The union or the OCTG producers could still appeal a ruling against them to a trade court sitting in New York City.  The Alliance for American Manufacturing adds that if Korea loses, it could take the case to the World Trade Organization, the secretive, pro-business trade decision-makers in Geneva, Switzerland.

Yogi, again.

All this could take years.  As Gerard told senators the week before, by the end, OCTG workers and other Steel Workers would have lost their jobs, their plants would have closed and the economic impact would be enormous.  Middle-class jobs would go down the tubes.

“I have no doubt that if you make a negative determination in this case these dumped imports will keep gaining market share,” Gerard told the ITC.  “This will lead to additional plant closures and thousands of workers like our members here” – he pointed out a dozen Steel Workers, from both OCTG plants and other steel mills — “will lose their jobs.”

-PAI