STEEL INDUSTRY Panel reviews tariffs' impact

A July WTO ruling is pushing Bush's economic team to drop the tariffs.
WASHINGTON (AP) - Steep tariffs on imported steel imposed 18 months ago have not significantly hurt small steel-consuming businesses, a federal trade panel concluded in a report released Friday that could reinforce President Bush's re-election strategy.
While "overall employment of steel-consuming industries generally fell or remained flat" in the year after the tariffs were enacted, "in many cases, employment fell by a greater amount [and percentage] in the year before the safeguard measures were implemented than in the first year after they were implemented," stated the U.S. International Trade Commission review released Friday night.
The ITC midpoint review of the tariffs outlines their impact so far on the domestic steel industry and steel consumers. It will be critical in resolving a White House debate pitting the president's political interests against economic realities over whether to keep or eliminate the tariffs.
Global trade laws
Bush imposed the tariffs, from 8 percent to 30 percent on certain kinds of foreign-made steel, in March 2002 to give the domestic industry a three-year respite from foreign competition to regroup and consolidate. At least 35 steel producers have declared bankruptcy since 1998, eliminating more than 50,000 jobs.
Consumers charge the tariffs prompted skyrocketing steel prices, resulting in thousands of lost jobs -- mostly in small businesses.
Bush's economic team is also pushing to drop the tariffs in the face of a July ruling by the World Trade Organization that they violate global trade laws. The European Union is threatening to impose $2.2 billion in retaliatory sanctions on U.S. exports because of the tariffs.
Presidential political advisers, however, believe rolling back the sanctions would harm Bush's 2004 goal of winning key Rust Belt swing states, mainly Pennsylvania, West Virginia, Ohio, Indiana and Illinois, where steel-making remains dominant.