Of Jobs and Indiana
Posted by SCapozzola on April 28th, 2008
AAM hosted a national conference call today to discuss the impact that trade issues and manufacturing job losses will have on the Indiana primary. AAM’s Scott Paul was joined on the call by a cross-section of Indiana business and labor, including: United Steelworkers Director Jim Robinson, U.S. Steel Vice President Terry Straub, and Gary, Indiana steelworker Larry Warman.
Indiana has lost more than 109,800 manufacturing jobs since 2000. With exit polls in Pennsylvania showing that more than half of Pennsylvania’s Democratic voters considered the economy the most important issue facing the country, it’s a good bet that job worries will be a key issue with Indiana voters as well.
During the conference call, which drew questions from leading national media, including the Wall Street Journal and Washington Post, Scott Paul made the point that flawed U.S. trade policies–and particularly the U.S. trade imbalance with China–has had a detrimental effect on U.S. manufacturing.
Echoing that sentiment, U.S. Steel’s Terry Straub emphasized that U.S. Steel is not anti-trade, but finds outright cheating by other countries “unacceptable.” Straub said that when the U.S. “plays by one set of rules and our trading partners use another, the system doesn’t work.” He added that China is now responsible for roughly half the world’s steel production, something he finds “stunning.”
China’s explosive growth in steel production capacity is fueled in large part by massive government subsidization. Scott Paul cited a recent AAM study that found Beijing handing out more than $27 billion in energy subsidies to its steel producers since 2000. As Jim Robinson of the United Steelworkers noted, these subsidies, along with illegal currency manipulation and dumping, can profoundly affect the competitiveness of U.S. manufacturers, and warned that Congress “shouldn’t wait for the next downturn in order to take action.”
As to how these issues will play in Indiana, Larry Warman, a production worker at the U.S. Steel plant in Gary, cited his fellow plant workers’ existing concerns about NAFTA. He suggested that many of his fellow steelworkers have long been worried by NAFTA, and will bring that viewpoint to next week’s primary. And so, whichever Democratic candidate can more fully articulate solutions to lost jobs may well win the Hoosier primary.
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April 28th, 2008 at 11:02 pm
Understanding the primaries and the debates are the focal point, what can we do to ease the impact of China’s unscrupulous behavior? In a little over a half a year the political circus will be over and we still will not have an answer. My industry is greatly impacted by the globalization of the steel market, because we make semi-finished steel products. The issues being driven by the Chinese policies are a piece of the pie and need to be addressed. I would like to know if anyone has an answer of what my company and I can do to increase the pressure on addressing these issues. Are there other groups, along with AAM, that we can participate in? Is there anything other then speaking to walls in congress?
The second issue is within our borders. The steel companies are recording above average performances on revenues due to the unprecedented amount of price increases this year. Americans are very good at adapting to what is thrown at them, but we are not good at looking at the impact to everyone as a whole. These price hikes are putting the manufacturers, using steel products, in a bind. We have to increase prices to the point that we are no longer competitive with overseas competitors. The large steel producers have rammed the prices down our throat, with little or no delivery performance. Through it all we are being told to “grin and bear it”. Does anyone know of any way to address this? The manufacturing companies, within the United States, need the big brothers to play nice so that we may all survive. This would benefit everyone and will pay large dividends in the end. There are opportunities for semi-finished product producers and finished product producers to gain on the global market. The only way we may be competitive is if the steel mills hold prices and give us that chance. By working together we can increase our sales, which will correlate in increased sales to the mills. Eventually the little guys are going to drown and mill sales will go down creating much less demand within the United States. A little patience is needed for the steel manufacturers to gain ground globally. Any help or direction to this matter would be greatly appreciated.