“We’ve seen this movie before,” Industrial Fasteners Institute chair Phil Johnson declared of the steel and aluminum tariffs set by U.S. President Donald Trump.

Johnson, CEO of Agrati’s ContMidGroup, predicted the Trump tariffs won’t last, just as the announced three-year 30% steel tariffs during the George W. Bush administration lasted only half as long as intended. After 18 months of the Bush tariffs, 1.2 million manufacturing jobs were lost, Johnson pointed out.

Johnson predicted the 2018 Trump tariffs may cost the U.S. 500,000 assembly jobs. It is estimated that for every added steel job 13 assembly jobs will be lost, he calculated. Johnson cited wheel nuts from China and Taiwan as becoming too competitive for U.S. manufacturers – along with other sub-assemblies and finished goods.

“We are not gaining if we are chasing away assembly jobs,” he reasoned.

The Trump tariffs, which include bar, rod, wire, ingot and flat rolled steel, may result in punitive retaliation tariffs on U.S. products, including likely targets of liquor, bluejeans and motorcycles.

The IFI had been active on the tariff issue for nearly a year when the Department of Commerce began a 232 national security investigation on steel and aluminum, followed by a public comment period.  

In July 2017, IFI board members had a “face-to-face” meeting with Secretary Wilbur Ross Jr. In September 2017, the IFI signed the first of two multi-association statements by steel and aluminum consumers on “consuming jobs vs. producer jobs” and the subsequent “downstream effects.”

Commerce delivered confidential reports to the White House in January 2018, and in February the IFI participated in the second multi-association letter to the president.

The IFI pointed out that “fasteners are an integral part of virtually all manufactured products and play a significant role in national security,” Johnson said.

The IFI notes that fastener manufacturers rely on access to “globally priced raw materials in order to remain competitive in the global economy.”

“Restrictions on raw materials such as steel and aluminum would result in increased imports of downstream, value-added products such as fasteners,” according to the IFI. “The negative impacts on downstream users likely would be greater than any benefits to steel and aluminum producers.”

  •  Unknown are what exclusions there will be. Officially 232 is supposed to involve Department of Defense purchases.

While China is frequently mentioned as a target of tariffs, Canada supplies 16.5% of steel for U.S. manufacturing vs. only 2.1% by China, Johnson pointed out. “China is not a factor,” as it ranks 11th as a supplier to the U.S., Johnson declared.

The #2 producer for the U.S. is Brazil at 13.5% an third is Korea at 9.2%. Following in order are Russia, Turkey, Japan, Germany Taiwan and India.

  •  Johnson brought up the possibility of the Trump steel tariffs triggering inflation. “If steel goes up, everything goes up,” Johnson explained.
  •  Though the Bush steel tariffs failed, this is a new president, Johnson acknowledged. “We don’t know what this president will do or exclude.”
  •  Johnson called on the fastener industry to contact members of Congress, the White House (email the President from WhiteHouse.gov or tweet President Trump @realDonaldTrump. Or click here to sign the petition online.

The White House, Congress and the media need to hear how tariffs on steel and aluminum impact Americans, Johnson noted.

“I’ve never heard ‘War is good’,” Johnson said of a looming tariff war.

“We’ve seen this movie before,” Johnson repeated. Web: IndFast.org