Dara Klatt

December 4, 2003


The PBN Company







Washington, DC: Consuming Industries Trade Action Coalition Steel Task Force (CITAC STF) Chairman William E. Gaskin heralded President Bush's decision today to end the steel tariffs as the "right decision for the 13 million workers in steel consuming industries, for the manufacturing sector that is just beginning to recover from tough economic times, and the overall U.S. economy."

Gaskin, who also is President of the Precision Metalforming Association (PMA), stated, "We applaud President Bush's decision to terminate the steel tariffs in their entirety.  Removing the tariffs provides a big boost to steel consuming industries that are now just recovering from the economic challenges of the last several years.  The President's decision also reinforces his free trade principles and works to restore U.S. global leadership on trade. We've got a win-win situation all around."

Gaskin continued, "The facts were all there for the tariffs to be terminated.  The President understood that for whatever good the steel tariffs have done for domestic steel producers over the past 20 months, 16 more months of the tariffs would not lead to more consolidation, or labor agreements, but would only work to further harm the steel industry's customers‹the steel consuming companies."

"Steel consumers are the customers of the domestic steel industry," said Gaskin.  "A healthy steel industry is good for steel consumers.  In turn, a healthy steel consuming sector is vital for domestic steel producers.  Since the tariffs were imposed, steel consumers were paying higher prices for steel, facing declines in availability and quality of steel, and their customers were taking their business overseas.  While those manufacturing jobs that have already gone overseas are not likely to return, the termination of the tariffs will help stop this trend and prevent a disastrous repetition of the supply crunch in 2002."

The decision today is expected to halt the European Union's retaliation on U.S. goods worth up to $2.2 billion.  Additionally, the U.S. will now be in compliance with the World Trade Organization (WTO) decision, which had declared that U.S. steel tariffs violated international obligations.

Speaking on the immediate legal implications of the decision, Lewis Leibowitz, a lawyer at Hogan & Hartson in Washington and CITAC STF Counsel, explained, "The President correctly based his decision to halt the tariffs on changed economic circumstances in the United States.  It is clear that the termination of the tariffs will help steel consumers in the U.S. by reducing prices from the levels they would have reached had the tariffs remained in place.  The removal of the steel tariffs eliminates a major cost for U.S. steel consumers that their global competitors don't have.  However, steel consumers still suffer from antidumping and countervailing duties that are still in place for many steel products imported into the U.S. meaning that substantial trade barriers still exist for steel."

Wes Smith, President of E&E Manufacturing Co. in Plymouth, MI, a manufacturer of heavy gauge stamped metal fasteners and progressive die metal stampings, stated, "The tariffs were a tax on steel consumers.  I'm happy that the President realized that you can't protect one sector of American manufacturing at the expense of another."

Gaskin added, "the decision on steel has been made, but consuming industries will continue to be actively involved in the debate on trade issues to ensure that concerns of consuming manufacturers are heard in Washington. Working on the 201 became an extraordinary effort of U.S. steel consumers taking an active role in trade policy issues.  That effort is here to stay. We look forward to renewing the competitiveness of American manufacturing and working with all interested U.S. groups from here on out to guard against special protections for certain sectors at the expense of the rest of the economy."

Gaskin concluded, "We call upon the domestic steel industry to work with steel consumers to overcome some of the common challenges we all face as U.S. manufacturers operating with global competition‹without resorting to protectionism.  We look forward to that effort, which will benefit us all."

CITAC is a coalition of companies and organizations committed to promoting a trade arena where U.S. consuming industries have access to global markets for imports that enhance the international competitiveness of American firms.  The CITAC Steel Task Force is comprised of steel consumers working to achieve the termination of the 201 steel tariffs by mid-point review and reform U.S. trade laws and policies to benefit U.S. steel consumers.




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