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Two of West Virginia's largest private employers,
Weirton Steel and Wheeling-Pittsburgh Steel, are locked in a battle
for survival. These companies, like so many other American
steel producers, are fighting against a wave of illegal, below-cost,
imported steel that has the potential to permanently cripple an
industry that is vital to this country's economic base and national
security.
The force of this wave can be seen in some disturbing
figures. According to U.S. Department of Commerce data,
in 1998, the U.S. imported more steel tonnage than ever
before. In fact, last year's import levels were 83 percent
higher than the annual import average for the previous eight
years. Across the country, at the height of the import crisis,
more than 10,000 steelworkers were forced off the job. At
least six steel companies have filed for bankruptcy. Much of
this damage can be linked directly to illegally dumped steel
imports.
To help Weirton, Wheeling-Pitt, and other steel mills,
I created a $1 billion loan guarantee program specifically designed
to provide some short-term relief to the American steel
industry. My initiative that will help domestic steel
producers by providing access to an infusion of capital to keep
their furnaces burning and keep their employees on the job.
Of the federal government's authority to guarantee up to $1 billion in loans to steel companies, $100 million of those funds is available at a federal guarantee rate of 95 percent of the principal and another $100 million is available at a federal guarantee rate of 90 percent of the principal. The remainder of the funding is available at the original 85 percent guarantee rate. No company could receive more than $50 million at the 90 or at the 95 percent guarantee levels. Previously, the program only allowed for an 85 percent guarantee rate on all loans. By increasing the percentage of the federal loan guarantee, these changes seek to make private lending to steel companies more attractive. Repayment does not have to be completed until 2015. My legislation establishes a three-member oversight
Board, consisting of the Chairman of the Federal Reserve, who heads
the loan guarantee board, the Secretary of Commerce, and the
Chairman of the Securities and Exchange Commission.
The loan guarantees will not solve the steel crisis,
however. There must be a long-term, permanent solution to this
crisis to prevent waves of illegal steel imports from drowning the
U.S. steel industry.
For 50 years, I have fought for American workers, for
the men and women who earn their livings by honest, hard work, and
who are playing by the rules as they seek to achieve the American
dream. The U.S. steel industry has made the sacrifices and
investments necessary to increase efficiency and compete effectively
against foreign makers. Our companies are willing and able to
play by the rules. As a nation, we must protect the viability
of our steel industry. To do so, we must insist that foreign
competitors are held to that same set of rules.
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