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PMA Members Tell ITC Consumers Cannot Endure 18 More Months of Tariffs
July 2003
Members of the Precision Metalforming Association (PMA) continued their fight to repeal the Section 201 steel tariffs in Washington, D.C. on July 22. At a hearing entitled ?Monitoring Developments in the Domestic Steel Industry,? steel producers and consumers of carbon and alloy flat products testified before the U.S. International Trade Commission (ITC). This hearing was part of the ITC?s mid-point review of the tariffs.
The ITC will present its report to President Bush this September, and he will then determine whether the tariffs should be continued for the full three years or terminated. Both sides have been embroiled in a lengthy battle over the tariffs, imposed by President Bush in March 2002. PMA represents steel-consuming industries, which have suffered loss of jobs, steel unavailability, poor quality of raw material, a rising cost of steel, declining profitability and loss of work to foreign competition since the tariffs took effect.
?Since the imposition of the steel tariffs, tool shops have been closing at a rate of one a week, and five stamping companies have closed in Western Michigan alone,? testified Jim Zawacki, chairman of GR Spring and Stamping, Inc. in Grand Rapids, MI, and chairman of the board of PMA. ?For example, Progressive Automation closed its business in May 2003?putting 120 tool makers out of work.? Zawacki explained that the continued decline of the steel-consuming industry will harm U.S. steel producers. ?The loss of a significant portion of the domestic steel industry?s customer base, as a result of the steel tariffs, will make it all the more difficult for the domestic steel industry to achieve global competitiveness,? testified Zawacki. ?In this respect, the steel tariffs have been counterproductive and will continue to be counterproductive for as long as they remain in effect. Steel tariffs only increased pressure on our customers to look offshore for steel parts.?
Richard Wilkey, president and founder of Fisher-Barton, Inc. in Watertown, WI, questioned the perception that the tariffs are beneficial to steel producers. ?Continuation of these tariffs will not solve the problems of our steel producers. On the contrary it will only exacerbate those problems. I think it incredible that any steel firm could argue with a straight face that continued tariffs are required to attract capital for investment,? Wilkey stated. ?On balance, the domestic companies are just as capable of competing internationally now as they would be after 18 more months of tariffs. But the additional period of relief will certainly make the plight of steel consumers worse.?
Zawacki summarized by saying, ?Manufacturing in this country is in as much trouble as it has been since the end of World War II. I am scared for our 220 employees and their families, my six children and grandchildren. Where will they find good jobs in the decades to come? The tariffs make a bad situation worse, which will not help the steel companies. We can?t wait 18 more months for relief.?
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