To those who remember the Great U.S. Steel Industry - in 1960 period a
friend of mine had a father who owned small steel company; during WWII
they were poor but in scrap industry suddenly became rich.....but he
gave me an article to read for this young man was concerned about the
steel industry - the article told of how steel could be imported from
Japan, and costs and all, still be sold cheaper over here than it cost
to make over here.....this shocked me for the handwriting was the wall
then.
JFK took on U.S. Steel, for they had raised the price of steel......he
called them sons-of-you know whats when they raised the price of steel
when as I recall they had said the would not - upon learning JFK had
called them such a name, they founded the SOB's Club.....big joke.
Today this article is example of one of our greatest industries now on
their knees begging for crumbs at the feet of who?
Where did this all really begin - well Americans in Ohio were told that
big business loved Income Tax and the people of Ohio voted for an Income
Tax state-wide, and we were told also this would lower property taxes -
money goes to schools.....we were sold sam bill of goods re the corrupt
Lottery system.....know of a cadillac dealer who won big lottery twice -
does lightning really strike same place twice or was this suspect? So
much for New Jersey gamblers who set up our lottery; today same
criminals corrupt everything they touch.
US Steel provided good paying Union jobs; but suddenly like Bill Gates
today, somebody goes after AT&T as a monopoly and sudden end result,
Western Electric here once had great jobs and thrived in 70
period....now a skeleton and even management is getting the ax and
former king makers under same table begging for crumbs from whom?
Never knew a lot of big business, but I keep remembering that article
this kid gave me, his name was Al Silberstein - and he was a brilliant
young man - he foresaw then, what is happening now.....
Interesting item here - once US Steel House on TV was biggest show on
TV......first cuss words uttered on TV when Lloyd Bridges yelled out
sons of biches after he lost control in a role he was playing about
lynching of young mexican for a crime he did not commit.....
So - will America do until Bill Gates what Amrican did unto U.S. Steel -
for you see, first they broke the Unions quietly by inviting UAW and
AFCME and other labor leaders into CFR - back in he 60 period to me
politics was fun - we had had Kennedy - and then that day in Dallas
suddenly, the fun was gone - not quite the same and the fact that a
President could be assassinated in a conspiracy of silence, I still find
shocking.
Saba
Leveling the Playing Field:
Antidumping and the U.S. Steel Industry
Executive Summary
Driven by mercantilist trade distortions that underlie the
global economic crisis, foreign exports of steel to the United States
have hit record levels in 1998 and are continuing at high levels in
1999. This sudden flood of steel into the United States has forced U.S.
steel mills to close or slow production and put thousands of steel
workers out of work. These problems have, in turn, sparked a debate over
what response, if any, the U.S. government should pursue. This paper
analyzes the causes and impact of the surge in steel imports and
analyzes the appeal of various policy responses, including U.S. trade
laws aimed at countering unfair trade practices, such as subsidization
and dumping.
The world steel market is perhaps the most distorted
industrial market in the world. To achieve economic and political
objectives, many countries have pursued industrial policies aimed at
nurturing a steel industry with trade protection and subsidies.
In contrast, the United States steel industry has generally
not been the recipient of such special treatment. The U.S. economy is
open and subsidies have been very limited, especially when compared to
those of other major industrial countries. In the 1970s and 1980s, the
U.S. steel industry had serious competitive problems, but $50 billion in
new investment has built an industry with some of the highest
productivity levels and lowest costs in the world.
Success in today's highly distorted world steel market,
however, often has less to do with investment, adoption of new
technology and increased labor productivity than with the industrial and
trade policies of foreign governments. The combined result of the
numerous steel industrial policies is that the world has tremendous
excess production capacity in steel. In such a situation, the high-fixed
cost structure of the steel industry encourages fierce price competition
during downturns. The involvement of governments, which press for
keeping production lines open and workers employed, greatly accentuates
this tendency. Dumping – sales in export markets below cost or sales
below the price in the home market – is the frequent result.
The United States has frequently used antidumping laws, which
counter dumping with offsetting duties, and countervailing duty laws,
which counter unfair subsidies, to level the international playing field
in steel. Since 1980, there have been 46 successful antidumping (AD)
cases involving steel and 27 countervailing duty (CVD) cases. In
response to the recent surge of steel imports, the U.S. steel industry
has filed a number of new AD/CVD cases. These complaints allege, with
considerable factual support, that companies from a number of countries,
including Russia, Japan, South Korea, and Brazil are again receiving
subsidies or are engaged in injurious dumping in the U.S. market, which
are illegal under both U.S. and international law. If these allegations
are upheld by U.S. authorities, offsetting duties will be imposed to
counter the injurious impact of these practices on U.S. steel
manufacturers and workers.
However, the economic desirability of imposing AD/CVD duties
has been questioned. Some argue that the United States would be better
off simply accepting dumped and subsidized products as "gifts to
consumers." While this line of analysis is superficially attractive, it
cannot withstand rigorous analysis.
The long term costs to producers and workers of failing to
counter the dumped and subsidized steel in the U.S. market substantially
outweigh the transient consumer benefits arising from short term price
cuts. Without an assurance that action can and will be taken against
trade distorting and illegal commercial practices, investment in and
production of steel and many other manufactured products in the United
States will become an unattractive proposition. Over time, the losses to
the U.S. economy in terms of lost production, investment, and high-wage
jobs, mount to painful levels.
This paper will demonstrate this point by using a dynamic
partial equilibrium economic model to simulate the economic impacts of
unrestrained steel dumping on the U.S. economy. Based upon historical
experience, injurious dumping is modeled as an intermittent or periodic
practice that is employed by foreign companies in only some years. Also
based upon historical experience, scenarios for 5 percent to 15 percent
price cuts due to dumping were considered. The results suggest that if
the United States had not imposed antidumping duties in the 1990s, the
economic costs of dumping would have outweighed the benefits of low
prices to consumers within several years. In 1997, the total net costs
of failing to counter dumping – lost economic activity, lower wages,
etc. – would have totaled between $71 and $338 million, depending upon
the level of dumping.
Based upon this simulation and related analysis, the paper
concludes that the United States has a strong interest in countering
dumped and subsidized steel imports. The alternative of simply accepting
these market distortions would harm the U.S. industrial base, erode
high-wage employment, and impose considerable net costs on the U.S.
economy. Additionally, political support for free trade in the United
States would likely erode in response to an obviously unlevel playing
field.
Without question, the global steel market is entering a period
that will require substantial adjustment. There is simply too much
production capacity in the world and some of it must close. By employing
AD/CVD duties, the U.S. government can ensure that efficient,
competitive U.S. capacity will not be driven out of business by unfair
foreign trade and industrial policies. By imposing duties on the imports
that are most heavily subsidized or dumped, AD/CVD laws also encourage
the closure of the least competitive steel mills around the world – a
desirable and efficient market outcome.
An alternative approach that is often suggested, limiting
imports through a Voluntary Restraint Agreement (VRA) may also preserve
the U.S. industry. This approach is far less attractive, however,
because governments, not markets, determine VRA market shares, and
because quota rents would go to foreign governments or companies.
A. Saba
Dare To Call It Conspiracy
A. Saba
Dare To Call It Conspiracy
http://econstrat.org/execsumm.htm
