White House Shuts Steel Door on Cheap Imports
March 5 -- In an effort to save what's left of a dying U.S. industry, the Bush administration today embraced the idea of higher import tariffs for steel from some foreign competitors.
Opting against a broad ban on cheap foreign steel, President Bush has removed the welcome mat for cheap steel from big allies like Japan, Germany, and Russia, by raising tariffs up to 30 percent against the importers, who vowed to fight back.
"These safeguards are expressly sanctioned by the rules of the World Trade Organization," Bush said in a statement, stressing that the move was only a temporary safeguard and urging that the industry take advantage of the time to restructure.
Heavy Decision to Make
American steel makers had pushed to keep cheap, below-cost steel imports from coming into the country with tariffs of up to 40 percent. They argued if nothing is done, they'd go out of business.
But the steel consuming industry and consumers maintained high tariffs would also mean higher prices for consumer products. In addition, some of America's trading partners say they will retaliate.
The decision comes after talk of a divide within the administration between those taking a free trade stance and those with their sights on saving steel industry jobs, especially critical since most of those jobs are concentrated in political swing states that could help determine control of the House in upcoming elections.
For instance, at Weirton Steel in the traditionally Democratic-leaning state of West Virginia — where Bush nabbed five crucial Electoral College votes in 2000 — the president's action was welcome news.
"I think it will save jobs, clearly," said Weirton CEO John Walker, "as we have been having some very difficult times." His company has shed 7,000 jobs in recent years.
Many Will Pay for Changes
Despite efforts at a comfortable compromise, both sides of the issue stand to lose, a point not lost on the president. "There are good people on all sides of this and [the decision] will probably cut both ways," Fleischer noted.
Related Stories
ABC News Live