United Steelworkers leader: Punish China, not Canada

United Steelworkers union president Leo Gerard expressed anger and frustration Tuesday over growing trade tensions between the U.S. and Canada, saying the longtime allies should have a united approach to attacking China and other countries responsible for the troubled state of their steel and aluminum industries.

“Instead of fighting with each other, we should be fighting with the real culprits,” Mr. Gerard, the son of a Canadian union miner, said in a telephone interview.

The Sudbury, Ontario, native said he and others were shocked by President Donald Trump’s decision not to exclude Canada from the tariffs that he has ordered on steel and aluminum imports.

The duties went into effect in March, but Canada, Mexico and the European Union had been given a temporary reprieve. The White House decided to impose the duties on the nation’s most trusted allies beginning June 1.

Steel shipments from Canada, Mexico and EU member nations are subject to a 25 percent duty, while an extra 10 percent is added to the price of aluminum imports.

“The steelworkers believe in tariffs. We just believe they should be brought against countries that cheat,” Mr. Gerard said, adding that is clearly not the case with Canada.

Mr. Gerard heads a Pittsburgh-based union that represents 1.2 million workers and members in the U.S., Canada and the Caribbean. While thousands of USW members work for Alcoa, U.S. Steel and other steel and aluminum producers, the union also represents workers in the chemical, health care, oil, paper, rubber and other industries.

The USW president said there has never been a steel trade complaint involving the U.S. and Canada.

The U.S. has an overall goods and services trade surplus with Canada, including a surplus in steel trade, he said. And the countries have had a strategic trade alliance for defense purposes on steel and aluminum since World War II, Mr. Gerard added.

Canada was the largest source of imported steel last year, accounting for 17 percent of the 34.6 million metric tons of steel that U.S. buyers purchased, according to the U.S. Department of Commerce. That amounts to about 6 million tons vs. the 10 million tons the U.S. exports to Canada annually, Mr. Gerard said.

“Neither one of those countries is the other’s problem,” Mr. Gerard said. “The U.S. and Canada ought to have a coordinated approach to [trade] cheaters.”

The USW president said China has deliberately financed industries that produce far more than can be consumed by its home market.

In steel, China went from having about 500 million metric tons of capacity during the U.S. steel industry’s 2002-03 recession to a current capacity of about 1.1 billion metric tons, he said. China and other countries subsidize domestic steel and aluminum producers and refuse to play by the rules of fair trade, he said.

Commerce Department figures indicate China accounted for about 2 percent of U.S. steel imports last year. But Mr. Gerard and other critics say much of China’s exports are shipped through third countries, masking the real country of origin.

The tariffs should target those trade rule violators, Mr. Gerard said.

Chances of such a united front dissipated in the wake of last week’s G-7 summit, where Mr. Trump took exception to Canadian Prime Minister Justin Trudeau’s opposition to the tariffs on Canadian goods. Mr. Trump called Mr. Trudeau “very dishonest and weak,” while White House trade adviser Peter Navarro suggested the prime minister “deserves a special place in hell.”

Mr. Gerard has supported Mr. Trump’s trade initiatives, but he declined to comment when asked about his support for the president following the administration’s remarks about Canada.

“I’m not going to get into that,” he said, adding that trade enforcement is the issue USW members are most concerned about.

Mr. Gerard said the comments of Mr. Navarro and White House economic adviser Lawrence Kudlow made following the summit were “over the top.” But the labor leader observed that he also has made comments during negotiations that he didn’t mean.

“You’ve got to hope that common sense will prevail,” Mr. Gerard said.

http://www.post-gazette.com/business/pittsburgh-company-news/2018/06/13/USW-leader-punish-China-not-Canada/stories/201806120093