Sunday, September 25, 2005
On the eve of China's admittance to the World Trade Organization, Congress took action to protect American industry and the jobs of Americans from sudden surges in imported Chinese goods.
Congress was correct in anticipating a problem and in passing what is known as Section 421; the Bush Administration has been woefully slow to react, even when the International Trade Commission has found clear evidence that 421 is being violated.
Locally, we are seeing the effects of China's ability to mount a quick attack on a specific market -- standard pipe. This is the kind of pipe that is used in plumbing, sprinkler systems and for fence posts. Local producers include Wheatland Tube, with plants in Wheatland, Sharon and Warren, and Sharon Tube Co. in Niles.
Tamara Browne, government affairs director for Schagrin Associates in Washington says the surge of Chinese imports is responsible for significant layoffs at the local companies. There is also an impact on the producers of flat-rolled steel used to make the pipe, such as WCI Steel Inc. in Warren.
A flood of pipe
In 2002, China exported 9,000 tons of standard pipe to the United States. That jumped to 266,000 tons in 2004, an increase of almost 30 times in two years. It is on track to nearly double this year, having already exceeded 400,000 tons.
This surge in imports, which is exactly what Section 421 was designed to address, is costing hundreds of American jobs and threatening the viability of American plants. The ITC is expected to rule on the complaint Oct. 3, and clearly it should find in favor of the American producers.
But that won't be enough. It will then be necessary for the administration to impose appropriate tariffs to stop the surge. Three times the ITC has ruled in favor of domestic producers that filed 421 complaints, but the administration took no action.
Winning a 421 complaint is of little solace to the 1,000 workers who lost their jobs producing wire products when the administration simply looked the other way.
Republicans and Democrats alike must speak with one voice in demanding that the administration respond quickly and effectively when U.S. trade law is being violated.