Steel
Users Urge President to Reject Steel Industry's Call for Import Relief
Bureau of National Affairs
Daily
Report for Executives
October 30, 2000
By
Rossella Brevetti
Reproduced with
permission from Daily Report for Executives, No. 210, p. A-9 (Oct. 30,
2000). Copyright 2000 by The Bureau of National Affairs, Inc. (800-372-1033)
http://www.bna.com.
The Consuming Industries
Trade Action Coalition, a coalition of steel-using companies and trade
associations, Oct. 26 urged President Clinton to reject calls from U.S.
steelmakers for relief from imports.
CITAC was reacting
to an Oct. 16 letter from steel industry and union officials asking the
Clinton administration to self-initiate a case under Section 201 of the
1974 Trade Act. Section 201 cases can result in import restrictions if
the investigated product is found to be a substantial cause of serious
injury or threat of serious injury to the U.S. industry.
The industry letter
also urged that existing restrictions on steel be kept in place and that
agreements be considered with countries that are not World Trade Organization
members. Steel imports surged to unprecedented levels in the United States
in 1998.
The industry letter
warned that imports are again above pre-crisis levels and are moving to
where they stood at the height of the crisis. "Because the relief Big
Steel demands is unwarranted and would create far more harm than good
to the United States economy, such a demand is contrary to the national
interest. We urge you to reject this and other calls for extraordinary
trade restrictions," CITAC Chairman Jon E. Jensen wrote in a letter to
the president. Copies of the letter were sent to the House and Senate
leadership.
CITAC members include
major producers of automobiles, heavy machinery, and a range of other
products. "Many of our members rely on steel products. However, U.S. producers
do not make enough steel or the right kind of steel to satisfy U.S. demand--that
is why we have substantial steel imports....Only adequate supplies of
imports ensure that downstream industries have sufficient supply," the
letter said. The letter said that relying on import restrictions is not
a solution for U.S. steelmakers. "Import restrictions not only hurt our
industries in the U.S.--they subsidize our competitors. As downstream
markets are distorted, U.S. customers will move out of the country, where
they can get the raw materials they need," it added.
Jensen called the
requests of the steel industry "inappropriate and ill-advised." If the
steel industry has a good case under Section 201, they should bring it
by petition, he stated in the letter. White House Chief of Staff John
D. Podesta recently told United Steelworkers of America President George
Becker that the administration was ready to take "all reasonable steps"
to prevent a repeat of the 1998 steel import crisis. The Podesta letter
to Becker stopped short of making any commitment on initiation of a Section
201 case.
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