April 23, 2018
Last Wednesday, April 18, 2018, at the National Press Club in Washington, DC, we released an important new analysis by economist Dr. John Martin, of Martin Associates, of the downward effect of tariffs on steel capacity utilization.
The Commerce Department’s report on The Investigation Conducted Under Section 232 of the Trade Expansion Act of 1962, As Amended, states that the “Secretary has determined that the only effective means of removing the impairment is to reduce import levels that should, in combination with good management, enable U.S. steel mills to operate at 80% or more of their rated production capacity.”
Dr. Martin’s new analysis, however, offered compelling data showing that there does not appear to be a relationship between steel imports and U.S. steel industry capacity utilization. In particular, the analysis shows that the capacity utilization of the U.S. steel industry actually declined during the period in which Section 201import tariffs were imposed (March 2002 – December 2003).
Almost immediately following release of our report, an anonymous Commerce Department official issued a cursory critique, alleging, among other things, that our study focuses on “short-term” analysis, and ignores other factors like the recession.
Today we are happy to respond, and to clarify the record. We appreciate the opportunity to have this discussion about this important
matter affecting hundreds of thousands of jobs in the steel supply chain, and the entire American economy.