Steel producers in the United States are facing stiff competition from China and other countries, whose high steel production rates are driving down the prices of the product globally. In response, domestic steel producers are lobbying the government to impose restraints on imports. This poses a serious threat to U.S. companies that rely on steel—and the higher prices will eventually hit consumers.
Tariffs limit choice and increase the cost of steel, which not only impacts consumers but could hurt millions of U.S. jobs. The domestic steel industry employs roughly 147,000 people. Meanwhile, U.S. steel-consuming manufacturers and construction companies support 12.8 million American jobs.
These companies, which rely on domestic and foreign steel to create finished products, will suffer if prices for one of their most vital intermediate goods are artificially increased
The federal government, however, is siding with steel producers.
>>>Read the full report: “The U.S. Steel Market Needs Free Trade, Not Favoritism”
There are currently 85 anti-dumping, a tax on foreign imports that are believed to be sold below their value, and countervailing duty orders on various steel imports. This hurts steel-using industries, and ultimately it will impact consumers most of all.
Goods American families rely on—such as our cars, washing machines, microwaves, and lawnmowers—are made from steel. Government intervention in the free market drives up the cost of steel, and those higher prices will be reflected in more expensive consumer goods.
Worse, they are not even helping steel producers. In recent testimony before the Department of Commerce and the United States Trade Representative, the international president of the United Steelworkers, Leo Gerard, explicitly stated that the “[United Steelworkers] has supported dozens of trade cases—primarily anti-dumping and countervailing duty cases—to try and address the flood of unfairly priced steel … but they have not been sufficient.”
At a recent event hosted by The Heritage Foundation, experts agreed that anti-dumping and countervailing duty tariffs are not effective for the domestic steel industry, and that they harm steel users here at home.
Instead of taking the knee-jerk reaction route of protectionism, the government should change its tactic, embracing the principles of free trade and keeping U.S. markets open to innovation, competition, and economic opportunity for everyone.
