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Manufacture This

The blog of the Alliance for American Manufacturing

The problem still lies with China.

Let’s take a trip down memory lane, way back to December 2016.

It was a different time. President Obama was still in the White House. North Korea hadn’t yet fired a ballistic missile that could potentially reach the Eastern Seaboard. Matt Lauer, Charlie Rose, Kevin Spacey and Harvey Weinstein all had jobs. And the biggest movie at the box office was a Star Wars film.

As much as things change, they stay the same. After all, the biggest movie in December 2017 is likely to be from the Star Wars saga. Also the same: China’s steel overcapacity, which continues to drive a global crisis that has cost American jobs and is putting our national security at risk.

But let’s go back to December 2016, when the Obama administration was still around. It made its final push to do something about China’s excess steel. 

Obama’s Commerce Secretary Penny Pritzker and U.S. Trade Representative Michael Froman traveled to Berlin for the launch of the new Global Forum on Steel Excess Capacity, which met to discuss ways to “exchange information and take effective steps to deal with the root causes of excess capacity.”

To its credit, the Obama administration had issued a number of tariffs on specific steel products to level the playing field for American workers and companies. That helped to momentarily stop the bleeding for U.S. steel companies and workers, but wasn’t enough to fix the crisis in the long-term.

After all, China was still producing way too much steel. G20 nations set up the forum aiming to “find meaningful and timely solutions that are required to restore healthy market function in the global steel sector.”

Nothing much got done during that first meeting, unfortunately. Here we are nearly a year later, and now it’s the Trump administration that will be sending a trade team to Berlin on Thursday for the next gathering of the Global Forum on Steel Excess Capacity.  

And it’s past time for the United States to get tougher in these negotiations.

China continues to drive this global crisis. Excluding China, the world’s steelmaking nations manufactured about as much steel as they used in 2016 — 821 million metric tons (mmt) were produced and 834 mmt were needed. China, meanwhile, made 808 mmt while only needing 681 mmt — and has the ability to bring online 357 mmt more at any time. 

China is doing this on purpose. It wants to drive steelmakers in the United States and Europe out of business so it can gain a monopoly on the global market. With hundreds of thousands of American jobs at stake — and the fact we need steel for our national defense and critical infrastructure —we simply cannot let this happen.

AAM President Scott Paul wrote Trump on Wednesday, urging the president to make good on the promises he made during the campaign and first months in office to stand up for American steelworkers by directly pressing China for "verifiable and enforceable net reductions in their excess production and overcapacity." Here’s more:

“Left unchecked, the overcapacity crisis continues to take its toll on our steelmaking capabilities and our highly skilled workforce, which are vital to both our economic welfare and national security. And, for the thousands of steelworkers left unemployed this holiday season, seeing the results you promised … can’t come soon enough.”

One thing that Trump can finally do to make good on those promises, Paul notes, is concluding the national security investigations into steel and aluminum imports and taking appropriate action based on the findings. Delays in the release of the investigations have led to a 20 percent surge in steel imports this year.

AAM isn’t the only one urging Trump to get tough in Berlin; Sens. Sherrod Brown (D-Ohio), Rob Portman (R-Ohio), Joe Manchin (D-W.Va.), Joe Donnelly (D-Ind.) and Todd Young (R-Ind.) also wrote Trump asking him to work alongside our trading partners to find “enforceable actions” that will effectively address the global steel crisis. The Senators write:

“International negotiations to reduce steel capacity are unlikely to produce real results without trade enforcement actions that address its underlying causes. Therefore, we urge your Administration to develop a comprehensive action plan.”

The Senators also ask Trump “to reach a swift conclusion” in the “Section 232” national security investigations.

You can help. Tell President Trump to keep his promise to stand up for steelworkers and finally unveil the findings of those investigations — and take necessary action to end this global crisis for good.

No More Delays

The Trump administration promised to unveil by July 1 the findings of national security investigations into unfairly traded steel and aluminum imports. That deadline is long past — and still no action.

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