Joe Biden’s Silent War on America’s Steel Industry

And Wishing You a Happy Super Bowl!

Joe Biden’s Silent War on America’s Steel Industry

The United Steelworkers Union (USW) have received “assurances” from President Joe Biden that he will support them in their fight against a potential Japan-based Nippon Steel takeover of Pittsburgh-based U.S. Steel.   U.S. Steel is the very same company that once made America the world’s largest steel producer – and is now a pale shadow of its former self because of decades of unfair competition.

My strong Trumpian message to USW leadership as Biden presses them for a presidential candidate endorsement as a quid pro quo is this: Don’t be fooled into thinking that Sleepy Joe has the backs of rank-and-file steelworkers.  Only Donald Trump ever has, and these statistics don’t lie:

Joe Biden’s silent war on both the U.S. steel and aluminum industries began years ago during his vice presidency.   Both America’s steel and aluminum industries, which are critical to national security, did indeed find themselves in steep decline after eight years of Obama-Biden. 

Consider that steel imports as a percent of total U.S. consumption rose from 22.7 percent in 2009 to 30.1 percent in 2016.  Aluminum imports as a share of total U.S. consumption jumped from 41 percent to 53 percent in just 2015 to 2016.

To fix the O’Biden mess, President Trump invoked Section 232 tariffs in March 2018, on all foreign steel and aluminum imports except from Canada and Mexico, at 25 percent and 10 percent respectively. -- I was in the Oval Office with then-Commerce Secretary Wilbur Ross when my old boss took this bold action.   Thus defended by the Trump tariffs, our steel and aluminum manufacturers would proceed to attract fully $15 billion of domestic investment while over 4,000 new jobs were created.

Behind the Trump tariff wall, both steel and aluminum imports also drastically decreased, from fifty-nine percent in 2017, to twenty-two percent by the end of 2019.  All because of Donald Trump’s tariffs!

Of course, Joe Biden would quickly tear all this good Trump work down with a dizzying array of givebacks.  For example, in October of 2021, Joe Biden suspended Trump’s steel and aluminum tariffs on the European Union (EU) for two years in exchange for a far weaker tariff-rate quota (TRQ).  This TRQ established a quota of historically-based volumes of EU steel and aluminum imports that could freely enter the U.S once again, and once again it was batten down the hatches at companies like U.S. Steel.

To make matters worse, in February 2022, Biden suspended steel tariffs on Japan in exchange for a TRQ.  This tariff-killer allowed up to 1.25 million metric tons of imported steel annually.

In June 2022, Biden ALSO lifted Trump’s steel and aluminum tariffs on the United Kingdom in exchange for yet another generous TRQ.  Then, Ukraine, too, was granted exemptions from steel tariffs for two years and now counting.  

Most recently, in December 2023, the EU was granted another two-year exemption from President Trump’s steel and aluminum tariffs until December 2025.  YIKES!

As the coup de grâce, Joe Biden also refuses to take retaliatory action against Mexico’s predatory trade practices threatening hundreds of American steel jobs and hundreds of millions of U.S. revenue and investment.  Indeed, Mexico has been ramping up production of steel conduit, otherwise known as steel pipe, typically used to carry power and communication cables, and dumping it into the U.S. market at 25% below U.S. market price.

Currently, imports of Mexican steel conduit into the U.S. are running at approximately 760% above historic levels seen between 2015-2017.  It’s so bad Zekelman Industries, one of the largest privately-held steel companies in the U.S., had to shut down its entire plant in Long Beach, California in October 2022. On top of this, Mexican steel producers have violated the rules of the United States Mexico Canada Agreement, reclassifying their steel conduit imports under other tariff codes to mask their continuous nefarious activities.

Over a dozen Senators on both sides of the political aisle have been urging Joe Biden and Katherine Tai, his U.S. Trade Representative, to reinstate 25% tariffs on Mexican steel conduit entering the U.S., for a year now.  However, the most the Biden administration has done to solve the problem for America’s steelworkers is engage in a dialogue with the Mexican government.  That’s quintessential Joe Biden: “All talk, no walk.”

Because of all of these ways Biden has dismantled or neutered the Trump tariffs, steel and iron imports have surged and employment remains below pre-pandemic Trump-era employment levels.  The best policy solution here for America is two-pronged. 

First, Biden needs to fully reinstate the Trump steel and aluminum tariffs so that U.S. Steel can once again prosper.  Fat chance of that, however, and the USW leadership certainly should not endorse Biden, even if he throws them the Nippon bone.

Second, and my guess is that if Trump were still in the White House and I was running the Office of Trade and Manufacturing Policy, he would have called me over to the Oval right after the Nippon bid and told me to figure out a way to resurrect the proposed merger of U.S. Steel with U.S. steelmaker Cleveland Cliffs.   That decidedly domestic partnership was a marriage made in national security heaven for America, and it’s exactly the kind of deal President Trump loves to get done.  It’s still out there – elections have consequences once again.

Peter Navarro served in the Trump White House as manufacturing czar and chief China hawk.