Bill offers defense against imports

Lawmakers act as foreign steel poses threat to U.S. product

May 25, 2001|By William Patalon III | William Patalon III,SUN STAFF

With a flood of foreign steel threatening to sweep away the U.S. steel industry, congressional lawmakers yesterday introduced legislation that they say would better protect American farmers and companies from the harm wrought by surging - and sometimes illegally priced - imports.

Congressional leaders say the legislation wasn't composed with only American steelmakers in mind, but the proposed reforms come at a troubled juncture for the nation's steel industry: Eighteen domestic producers have sought bankruptcy protection since the end of 1997, according to one study, and several have failed. More bankruptcies are expected.

"We are in a crisis. We are past a crisis for some companies," said Rep. Benjamin L. Cardin, a Baltimore Democrat who helped introduce the bipartisan legislation. "It's sad. It's not because these companies haven't downsized. And it's not because they haven't invested. They've done both. But with the high level of imports coming into our economy, and with the pricing [made artificially low by the glut of foreign-made steel], you can't possibly make money on your product."

The trade-law reforms would safeguard U.S. firms against imported goods that are subsidized, or which are sold here for less than the foreign producer sells them in its home market - an illegal practice known as "dumping." The legislation also would make it easier for American industries to seek relief when imports suddenly increase, even when there are no unfair trade practices involved.

Yesterday, a group of steel industry leaders was scheduled to go to Capitol Hill for a meeting with members of the Bush Cabinet and other officials, said Bette Kovach, spokeswoman for Bethlehem Steel Corp., which operates the Sparrows Point complex. According to Kovach, Duane R. Dunham, Bethlehem Steel's chief executive officer, was among those set to meet with Treasury Secretary Paul O'Neill, Commerce Secretary Donald L. Evans and U.S. Trade Representative Robert B. Zoellick.

Steel industry executives have urged the Bush administration to impose stringent restrictions on imports, a power the president has under a 1974 U.S. trade act.

The unions are involved, too. Wednesday night, an estimated 1,000 to 1,500 people turned out for a Sparrows Point rally organized by local members of the United Steelworkers of America, which has been pushing for passage of another piece of legislation: House Bill 808. That bill, also known as "The Steel Revitalization Act," not only proposes a five-year limit on imports, but also paves the way for mergers among American steel companies.

Yesterday's proposal introduced by House members addresses some of the weaknesses in existing trade laws and consists of three parts, Cardin said.

The first makes it easier for U.S. industries to prove injury from damaging import surges - which often occur too quickly to be addressed by existing laws, though they often harm American companies. The second part amends the antidumping and countervailing duty laws to help U.S. manufacturers and farmers get relief from imports that are dumped or subsidized. The final part authorizes creation of a program to help the government to be better at collecting and distributing key data on steel imports, Cardin said.

Experts have long said such a system would be the only way to spot a sudden surge in steel imports quickly enough to keep the U.S. industry from being injured.

Wire services contributed to this article.

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