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The World Trade Organization, with which the United States has numerous and
binding agreements, ruled that U. S. steel trade tariffs are illegal and in violation of
international free trade.
The WTO sets the state for the European Union to impose up to $2 billion of
economic sanctions against U.S. companies that export to them.
The tariffs were intended as a "last gasp effort" to save the faltering U.S. steel
industry to recover from "unfair" competition.
Imported steel was often sold below its cost of production or was being subsidized
by foreign governments in order to gain the market.
Still, several U.S. steel-consuming companies want the tariffs eliminated, desiring
cheap foreign steel.
Forty-two steel companies, including Wheeling-Pittsburgh Steel and Weirton Steel,
filed for bankruptcy and more than 50,000 steelworkers lost their jobs. Wal-Mart
replaced steelworkers as the largest private-sector employer in West Virginia.
The federal government took over pension plans for 17 of the companies, involving
240,000 beneficiaries and nearly $7 billion in unfunded pension benefits. Next to go
are health benefits, long promised steel workers after retirement.
In the middle of the collapse are hundreds of steel company executives who have
million dollar agreements and golden parachutes.
Leo W. Gerard, president of the United Steelworkers of America said it is "the
latest in a long line of WTO decisions undercutting America by overriding our trade
laws and the nation's ability to make sovereign decisions in the interest of the
American economy and the American people.
He said at stake are the jobs and survival of the entire American steel industry,
although nearly every other manufacturing company has shifted to foreign
countries for cheap labor under trade agreements signed by the American
government for the past twenty years.
Mark Glyptis, president of the Independent Steelworkers Union at Weirton Steel,
called on the Bush administration "to give strong consideration to withdrawing
from the WTO."
Glyptis said the U. S. can't compete with "free trade" when foreign manufacturers
are subsidized and supported by their governments. "All we have asked for is a
level playing field," he said.
Senator Robert Byrd called the WTO a "renegade" organization that made "yet
another unjustified and wrong-headed decision that will benefit America's trading
partners at our expense."
Sen. Jay Rockefeller said, "The ruling by the WTO is flat-out wrong. It is yet another
indication of an anti-U.S. and anti-safeguard bias at the WTO. This bias needs our
serious attention because it undermines the WTO and any hope of achieving fair
trade."
Rep. Shelley Moore Capito, R-W.Va., said, "The WTO is blatantly ignoring the fact
that the tariffs were put in place because of unfair trade practices by foreign steel
producers. This situation was leading to excess steel being dumped into the
U.S."
"I am hopeful an agreement can be reached that allows the tariffs to stay in place
until the steel industry stabilizes," Capito said.
Rep. Bob Ney, R-Ohio, said China is paying its workers pennies per hour and
flooding the marketplace with their cheap goods.
Ney said "This decision really says it all when it comes to the legitimacy of the
WTO in my eyes. It is anti-American, and more importantly, it is anti-American
worker," said Ney, who represents counties in eastern Ohio.
Many politicians from both political parties, who now favor tariffs to save the steel
industry, have been on the "free market," world trade bandwagon for years.
Regarding jobs, Glyptis says they have been a "throw the baby out with the
bathwater" deal, a matter of cheap foreign labor with America's workers being left
with low-paying service industry jobs.
"What really hurts is the breaking of the retirement plans and health plans," he
said.
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