Trade Cases

Durbin: “Tariffs Like Dropping a Bomb on a Flea”

Written by Sandy Williams

Reaction to the official announcement and signing of the Section 232 proclamation brought swift reaction from the industry and Congress.  Opinions ranged from unwavering support, “the era of American trade surrender is coming to an end,” to total dismay, “the sweeping tariffs announced today are like dropping a bomb on a flea.”

Supporting the 25 percent steel tariff and 10 percent aluminum tariff was the Steel Manufacturers Association:

“We are optimistic that these tariffs will adjust imports to provide a level playing field and ensure that the steel industry in our country is able to serve our national security needs. We look forward to the measures being in effect for a period of sufficient duration for companies to reinvest in the steel industry. We also support limited exceptions for key allies, including Mexico and Canada, well-regulated exclusions for products not available from U.S. producers, and mechanisms to avoid transshipment and circumvention of the tariffs. Effective measures will allow the domestic industry to preserve and strengthen our national defense industrial base,” said Philip K. Bell, President of SMA. 

“We hope the era of American trade surrender is coming to an end,” said Alliance for American Manufacturing President Scott Paul. “Any exclusions to the tariffs must be narrowly crafted, strategic in nature, and shouldn’t fill the D.C. lobbying swamp. The goals of this trade action must be to secure America, increase our steel jobs, slash global steel overcapacity, and stop unfair trade practices that harm workers.”

American Iron and Steel Institute President Thomas Gibson said today’s action will “stem the tide of unfair imports and put steelworkers back to work.”

Nucor CEO John Ferriola commented, “The Commerce Department was correct in concluding that illegally traded imports impair our national security by limiting the ability of our domestic steel industry to supply national defense and critical infrastructure needs, and the Trump administration is taking the appropriate response to this threat. Competing on a level playing field will enable us to keep doing what we have been doing for five decades – invest in our teammates, our facilities, and new technology.”

AK Steel, as the only domestic producer of electrical steels, was pleased by the tariffs. AK Steel CEO Roger Newport urged Commerce to “address the need to cover downstream electrical steel products that are critical to our nation’s electrical grid infrastructure, which is vital to the national security of the United States. This is important to curb any potential future circumvention of the remedy that would render it ineffective.”

U.S. Steel President & CEO David Burritt said, “For far too long, steel imports have been allowed to undermine America’s steel strength. Our national security is only as strong as American steel. President Trump’s action will begin to level the playing field for the security and manufacturing strength of the United States.”

Downstream industry associations were not as pleased as the steel manufacturers. A statement from the National Tooling and Machining Association and Precision Metalforming Association was issued immediately following the signing ceremony. 

NTMA President Dave Tilstone and PMA President Roy Hardy said, “We continue to oppose the steep tariffs on steel and aluminum announced today. These tariffs will damage downstream U.S. steel and aluminum consuming companies, as the U.S. will become an island of high steel prices that will result in our customers simply sourcing our products from our overseas competitors and importing them into the United States tariff-free.”

They added, “Our associations plan to work to end these tariffs as soon as possible so that the president continues to fulfill his commitment to protect and grow U.S. manufacturing.”

The Air-Conditioning, Heating, and Refrigeration Institute said its 320 member companies rely on abundant steel and aluminum supply and do not support the tariffs. “”While we have been pleased with the Trump administration’s enthusiastic support for manufacturing, and are happy that the president did include at least a temporary exemption for supplies from Canada and Mexico, we believe this step to be injurious, rather than helpful, to our efforts to increase American manufacturing and create jobs,” said AHRI President and CEO Stephen Yurek.

The Associated General Contractors of America said it will work to convince the President to reconsider the costly new tariffs. “Considering the damages these new tariffs will inflict on the construction industry, it is easy to understand why recent, independent studies estimate that nearly 30,000 construction workers will lose their jobs because of these new tariffs,” said AGC CEO Stephen Sandherr.”

Sandherr added, “The bottom line is that any short-term gains for the domestic steel and aluminum industries will likely be offset by the lower demand that will come for their products as our economy suffers the impacts of these new tariffs and the trade war they encourage. A better way to cultivate a stronger domestic steel and aluminum industry is to increase federal funding for infrastructure projects that will boost demand for these and many other products.”

Senate Commentary

Members of the Senate were also swift in expressing opinions on the president’s decision. Sen. Jeff Flake, R-Ariz, referring to the president calling the tariffs flexible and retaining the authority to make changes to them, said, “Flexible tariffs? What does that mean? One day you wake up and say, ‘I don’t like Australia?’ It’s unbelievable.”

“These so-called ‘flexible tariffs’ are a marriage of two lethal poisons to economic growth – protectionism and uncertainty. Trade wars are not won, they are only lost,” Flake said in a statement. “Congress cannot be complicit as the administration courts economic disaster. I will immediately draft and introduce legislation to nullify these tariffs, and I urge my colleagues to pass it before this exercise in protectionism inflicts any more damage on the economy.”

Senate Democratic Whip Dick Durbin commented,The sweeping tariffs announced today are like dropping a bomb on a flea. Launching an all-out trade war will alienate the allies we need to actually solve the problem of steel dumping, and could have huge unintended consequences for American manufacturers who depend on imported materials.”

Arizona Sen. John McCain said the action was “reminiscent of failed protectionist policies of the past.”

“America should engage on trade from a place of leadership, demonstrating confidence and strength,” said McCain. “We should champion a positive free trade agenda to break down trade barriers and open new markets for American companies. That is the true path to creating jobs, growing our economy, and protecting our national security.”

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