Julia wrote: > I don't think this is a good idea. > > 1) I'd like to hear from everyone here who has an opinion, are > you for or against this? > > 2) Does anyone want to try to persuade me that this is actually > a good idea? (If you're against it and don't want to > constructively play devil's advocate, please leave this question > alone. Thank you. While I'm not feeling as pissy as I was > yesterday, I'd prefer that no one use my query as an excuse to > indulge in less-than-exemplary behavior, and will probably rudely > take to task anyone who does so.)
I am not wild about imposing tariffs, I can understand the decision. I am also talking as a person who is in a steel related business. We as a company buy millions of pounds of steel every year. I also work in a union environment; and let me tell you NOBODY around here likes to see a "made in Russia" sticker on a coil of cold-rolled steel. The steel industry has been taking it on the chin for many years now, but is not the inefficient monolith that everyone here seems to think. To quote Rep. Peter Visclosky, D-Ind. "Since 1980, the industry has spent $60 billion to increase efficiency. Productivity has increased 156 percent, and man-hours per ton have declined from 10 to 3.5. Today, no one produces a ton of steel more efficiently than American steelworkers do." To say that America hasn't poured money to make the industry more efficient is not looking hard enough. Right now my company pays about 19-20 cents per pound for cold-rolled steel (CRS). With the tariffs in place, our cost would go up to between 23 and 25 cents. (A lot of factors go into this....when the contract is signed, transport costs, length of contract, amount of steel purchased...etc) I would like to see the cost per pound of AU and NL CRS. I expect to see prices at US mills to be around 25 cents per pound. Before the tariffs we could get imported steel averaging about 17 cents a pound. Why is imported steel so cheap then? Because over here we have: 1. High US wages 2. High regulation/enviromental costs 3. "Legacy" costs (includes pensions and healthcare for retirees (about $9/ton)) With all the strides that US steel has made over the years, (including eliminating 270,000 jobs) the industry will get no more profitable because of the above listed reasons. I am sorry, but I don't want to see the steel industry die just because we couldn't outcheap the competition. What about a trade war? I am not all that worried about it. Trade wars are typically started by politicians who don't know how to run a business. Look on the bright side -the tariffs are phased out over a three year period. Over next three years, I don't see a lot of wiggle room over reasons one and two, but I could see a Federal buyout of some of the "Legacy" costs incurred by American companies. Oh, people who are very happy about the tariffs- Canada, Mexico, Brazil, Argentina, India, Turkey....or anyone else not named in the tariff action. Just try to place an order for steel at a Canadian mill. I typically am against tariffs and the like....bad for business. But nobody has given a compelling reason for allowing the steel industry to wither on the vine. Just a humble manufacturing engineer, Matthew Bos
