RETAINING A STRONG AND HEALTHY STEEL INDUSTRY IN U.S. IS A MUST -- HON. RALPH REGULA (Extensions of Remarks - February 27, 2002)

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HON. RALPH REGULA OF OHIO IN THE HOUSE OF REPRESENTATIVES Wednesday, February 27, 2002

Mr. REGULA. Mr. Speaker, I would like to commend the President for initiating his three-prong program to address the steel import crisis. This crisis, caused by a worldwide over capacity of steel making is slowly destroying our domestic steel industry. The increased level of imports, often subsidized by foreign governments, keeps driving steel prices down. Not even the most efficient steel mills in the U.S. are able to make money when steel is priced so low. As of this week, thirty-one steel companies have declared bankruptcy and over fifty steel-making and related plants had been shut down.

The President's steel plan includes the Section 201 investigation initiated last June and efforts to negotiate a reduction of worldwide steel making capacity with foreign nations. The key element in the President's plan is the 201 investigation. The International Trade Commission (ITC), which completed the 201 investigation last fall, unanimously found that the level of steel imports coming into the U.S. was injuring the domestic steel industry. Now it is up to the President to implement a meaningful remedy. The industry and its workers are asking for at least 40 percent tariffs across the board. Tariffs would provide the most immediate relief to the industry allowing prices to recover. Tariffs would also send a clear message to our trading partners that this U.S. is not the dumping ground for all the world's excess steel.

Our steel companies need a ``time-out'' from the constant flow of low-priced imports. Strong tariffs will provide such a ``time-out.'' Domestic steel companies and their workers have downsized and restructured and they continue to do so. One example is Republic Technologies International, which has facilities in my Congressional District. Republic had to file for bankruptcy protection. In order to keep operating in this very difficult market, all workers had to take a 15 percent pay reduction and additional cost cutting measures are being implemented to reduce costs another 20 percent. Overall employment has fallen by 20 percent recently. The type of 201 remedy will directly impact how Republic will be able to restructure and come out of bankruptcy. If the President implements a strong remedy, investor confidence will increase and Republic will be able to preserve more jobs as it restructures. If the President imposes a weak remedy, Republic may face significant job cuts during its restructuring.

As steel mills close, it is not just the steelworkers and their families that suffer. Steel company retirees will lose their retiree health benefits in many instances. Furthermore, every steelworker supports more than three jobs in other industries, from workers who make production equipment to those who process raw materials and move the steel products to market. Steel communities are also impacted by the loss of steelworker jobs because people buy less groceries and use less services. It is imperative that we retain a strong and healthy steel industry in the U.S. not only for our economic well-being but also to supply our national defense needs.
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