WASHINGTON – Though it was less than they hoped for, some steelworkers said Tuesday that President Bush's plan to impose tariffs on imported steel was the first step toward reopening shuttered plants and getting laid-off workers back on the job.
President Bush decided Tuesday to impose tariffs of 8 percent to 30 percent on several types of imported steel under a three-year plan. The compromise plan fell short of the 40 percent that the battered steel industry had been seeking.
Tony Plomaritis, 58, of Merrillville, Ind., who worked as a pipefitter at LTV Corp. (LTVCQ) for nearly 30 years before being laid off when the company filed for bankruptcy Dec. 7, said the Bush plan comes as a relief.
He now hopes that he will be recalled to work now that WL Ross & Co. LLC of New York is buying LTV's steel operations. "This tariff tells me that the plant is going to open back up," Plomaritis said.
While protecting steel jobs, the tariffs also could raise the cost of many products containing steel, from cars to desks to lawn mowers. It also was drawing opposition from U.S. allies.
In making his decision, Bush rejected the industry's request for a $10 billion bailout of pension and health care costs for retirees of bankrupt steel companies, according to those familiar with his decision. But the president left room for Congress to seek ways of providing health care protection for retirees of bankrupt companies in general, not only those in the steel industry, the officials said.
Loren Hanson, a committee chairman with United Steelworkers of America Local 1011 in Indiana, said the 30 percent is helpful, although the union was hoping for 40 percent.
Hanson said the union would like to see a surcharge on every ton of steel, imported and domestic, to help pay health care for retirees. He said 60,000 LTV retirees are losing their health care benefits this month. "What's going to happen is people aren't going to be able to pay for health care so they are going to go on welfare anyway," he said.
Some nations, including Canada and Mexico, would be exempt from the product-by-product tariff changes, administration officials said Monday, while China, Japan, South Korea, Ukraine and Russia were expected to be hit the hardest by the tariffs.
A variety of specialized parts made from steel also would be subjected to either quotas, tariffs or a mix of both, the officials said.
Steel unions have pulled out all the stops for tough tariffs, largely led by the United Steelworkers of America. In a culmination of a five-year, $5 million campaign, the union organized a rally near the White House last week that attracted about 25,000 steelworkers and supporters from across the country.
The unions, also joined by the steel companies, have had continuous discussions with members of Congress and the Bush administration, in addition to e-mails, faxes, phone calls, letters and fliers.
"It's true grass-roots mobilization," said Gary Hubbard, spokesman for the steelworkers union, which also paid for print, TV and radio ads, and hired high-powered Washington consultants — Republican and Democrat.
The "rapid-response system" was developed after the steel crisis of the past decade, when the union was caught flat-footed by a flood of imported cheap steel from Asia. "All we could do was have Bruce Springsteen come and raise some money for food banks," Hubbard said. "We vowed that wouldn't happen again."
The campaign largely has been funded by the industry's crisis fund, established in the last recession for expenditures that must be agreed upon by unions and steel companies, Hubbard said.
Opponents of higher tariffs, such as the Consuming Industries Trade Action Coalition, have waged their own aggressive lobbying campaign focusing on possible job losses and soaring prices.
The Coalition, which represents steel users, commissioned a study that found that imposing tariffs of 20.7 percent on imported steel would wipe out 74,500 jobs in steel consuming and related industries while saving only 8,902 jobs in the steel industry.
But steel supporters point to figures showing that the U.S. industry already has dwindled to just 142,000 workers, down by more than two-thirds since 1974.
Bush's decision is politically charged.
Political strategists say the steel issue could play a major role in as many as six House races — meaning it could determine control of the closely divided chamber.
Much of the steel industry also is concentrated in states crucial to winning the White House. In 2000, Bush lost Michigan, New York and Pennsylvania. Bush narrowly carried Ohio and West Virginia. In addition, a large portion of the roughly 300,000 retired steelworkers live in Florida.
Bush scored an upset victory in West Virginia two years ago, largely because of his promise to protect the steel industry after the Clinton administration refused to step in.