OPINION:
The United Steelworkers Union has received “assurances” from President Biden that he will support its members in their fight against a potential takeover by Japan-based Nippon Steel of Pittsburgh-based U.S. Steel.
U.S. Steel is the company that once made America the world’s largest steel producer — and is now a shadow of its former self because of decades of unfair competition.
My strong Trumpian message to the union’s leaders as Mr. Biden presses them for a presidential candidate endorsement as a quid pro quo is this: Don’t be fooled into thinking that he has the backs of rank-and-file steelworkers. Only former President Donald Trump ever has, and the statistics don’t lie.
Mr. Biden’s silent war on the U.S. steel and aluminum industries began years ago during his vice presidency. America’s steel and aluminum industries, which are critical to national security, did indeed find themselves in steep decline after eight years of the Obama-Biden administration.
Consider that steel imports as a percentage of total U.S. consumption rose from 22.7% in 2009 to 30.1% in 2016. Aluminum imports as a share of total U.S. consumption jumped from 41% to 53% in just 2015 to 2016.
To fix the mess, Mr. Trump invoked Section 232 tariffs in March 2018 on foreign steel and aluminum imports except those from Canada and Mexico, at 25% and 10%, respectively. I was in the Oval Office with then-Commerce Secretary Wilbur Ross when my old boss took this bold action. Thus defended by the Trump tariffs, our steel and aluminum manufacturers would proceed to attract $15 billion of domestic investment while over 4,000 new jobs were created.
Behind the Trump tariff wall, steel and aluminum imports also drastically decreased, from 59% in 2017 to 22% by the end of 2019. All because of Mr. Trump’s tariffs.
Of course, Mr. Biden would quickly tear all this good work down with a dizzying array of givebacks. For example, in October 2021, Mr. Biden suspended Mr. Trump’s steel and aluminum tariffs on the European Union for two years in exchange for a far weaker tariff-rate quota, or TRQ. This TRQ established a quota of historically based volumes of EU steel and aluminum imports that could freely enter the U.S. once again, and once again, it was batten down the hatches at companies like U.S. Steel.
To make matters worse, in February 2022, Mr. Biden suspended steel tariffs on Japan in exchange for a TRQ. This tariff-killer allowed up to 1.25 million metric tons of imported steel annually.
In June 2022, Mr. Biden also lifted Mr. Trump’s steel and aluminum tariffs on the United Kingdom in exchange for yet another generous TRQ. Then, Ukraine was granted exemptions from steel tariffs for two years and now counting.
Most recently, last December, the EU was granted another two-year exemption from Mr. Trump’s steel and aluminum tariffs until December 2025. Yikes!
As the coup de grace, Mr. Biden also refuses to take retaliatory action against Mexico’s predatory trade practices, which threaten hundreds of American steel jobs and hundreds of millions in U.S. revenue and investment. Indeed, Mexico has been ramping up production of steel conduit, otherwise known as steel pipe, typically used to carry power and communication cables, and dumping it into the U.S. market at 25% below U.S. market price.
Currently, imports of Mexican steel conduit into the U.S. are running at approximately 760% above historic levels seen between 2015 and 2017. It’s so bad that Zekelman Industries, one of the largest privately held steel companies in the U.S., had to shut down its entire plant in Long Beach, California, in October 2022. On top of this, Mexican steel producers have violated the rules of the United States-Mexico-Canada Agreement, reclassifying their steel conduit imports under other tariff codes to mask their continuous nefarious activities.
Over a dozen senators on both sides of the political aisle have been urging Mr. Biden and Katherine Tai, his U.S. trade representative, to reinstate 25% tariffs on Mexican steel conduit entering the U.S. for a year now. But the most the Biden administration has done to solve the problem for our steelworkers is engage in a dialogue with the Mexican government. That’s quintessential Joe Biden: all talk, no walk.
Because of all of the ways Mr. Biden has dismantled or neutered the Trump tariffs, steel and iron imports have surged, and employment remains below pre-pandemic Trump-era employment levels. The best policy solution here for the United States is two-pronged.
First, Mr. Biden needs to fully reinstate the Trump steel and aluminum tariffs so that U.S. Steel can once again prosper. Fat chance of that, however, and the leaders of the United Steelworkers Union certainly should not endorse Mr. Biden, even if he throws them the Nippon bone.
Second, and my guess is that if Mr. Trump were still in the White House and I were running the Office of Trade and Manufacturing Policy, he would have called me over to the Oval Office right after the Nippon bid and told me to figure out a way to resurrect the proposed merger of U.S. Steel with U.S. steelmaker Cleveland Cliffs.
That decidedly domestic partnership was a marriage made in national security heaven for America, and it’s exactly the kind of deal Mr. Trump loves to get done. It’s still out there — elections have consequences once again.
• Peter Navarro served in the Trump White House as manufacturing czar and chief China hawk. This piece originally appeared at http://peternavarro.substack.com.
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