Rep. Kelly Welcomes Local Steel Company to Congressional Hearing on Tariffs

Apr 13, 2018 Issues: Trade
Rep. Kelly with AK Steel Corp. CEO Roger Newport
Rep. Kelly Welcomes Local Steel Company to Congressional Hearing on Tariffs

CEO of AK Steel in Butler testifies before Ways & Means Committee


WASHINGTON — U.S. Representative Mike Kelly (R-PA) – a member of the House Ways and Means Committee – participated in yesterday’s full committee hearing on “the Effects of Tariff Increases on the U.S. Economy and Jobs,” which featured witness testimony by Roger Newport, Chief Executive Officer of AK Steel Corp., which operates a manufacturing plant in Butler, Pennsylvania. Mr. Newport was invited to testify at the hearing by Rep. Kelly.

Excerpt of remarks by Rep. Kelly:

“One of the things I’ve marveled at is that for decades now we’ve complained about our loss of market shares, somehow thinking that there is an honor system out there, that people will just stop doing bad things to us because we’re nice to them. … Being in the automobile business and watching the loss of market share has been incredible. You don’t get it back once it’s gone.”

“Last week, during our district work week, [my staff and I] actually went down to AK [Steel] to watch them make electrical steel. … We also were up in Sharon at Wheatland Tube and we were … looking at the crankshaft business up there, Sharon Crankshaft. … I watched the hardworking men and women of AK and what they’re doing, and I’ve been there my whole life so I know what they do. And I would really suggest to members of Congress: instead of talking about it, go look and see what these people do—actually see what it is we’re talking about.”

“You [AK Steel] are the last producer of electrical steel in the United States. I am constantly told about how fragile our power grid is. We could lose that [power grid], and if we were to lose that, what would the effect be on our national security? And I understand the concern about what’s going on now… ’Free trade, as long as it’s fair trade.’ So what do you do when you find that it’s not fair trade? You go to the WTO. How many years does it take to get a ruling on it? Sometimes three, sometimes four… That ship sailed. You win the case, you lose the market. I wish we would stop talking about it as ‘unfair trade practices’ and [instead call it] ‘illegal trade practices’.”

“I really do believe that at some point you’ve got to just not talk the talk, you’ve better walk the walk. And for us to sit back and allow the rest of the world to pick our pocket and say ‘I wish they wouldn’t do it,’ somewhere along the line, we’re going to get caught up with this. … Us losing our base, our manufacturing base, puts us in one hell of a bad position in a global economy right now and in a situation where everything is just so fragile.”

Excerpt of testimony by AK Steel CEO Roger Newport:

“I think it is important to put into context what some are calling a ‘new’ trade war. Our experience is that China has been fighting to undermine the American steel industry for many years, and our electrical steel business provides a good example. Before 2009, exports to China represented a significant part of AK Steel’s sales of GOES. In 2009, however, China imposed unnecessary and illegal duties on GOES manufactured in the United States, effectively barring AK Steel and other producers from selling in the Chinese market. In response, the United States Government, at the urging of AK Steel, filed a case at the World Trade Organization (WTO) challenging China’s baseless implementation of duties. In 2015, after five long years of litigation, the WTO ultimately determined that China did not meet its obligations under the WTO agreements when it imposed these duties on U.S.-produced GOES. Unfortunately, by that point the damage had already been done to U.S. exports of GOES. China used the five-year period during which U.S.-made GOES was excluded from the market to dramatically increase Chinese electrical steel production capacity. China achieved this rapid expansion through state-sponsored subsidization of the Chinese GOES industry, which allowed Chinese producers to sell their newfound capacity at prices so low that no other producers could compete.”

“We encourage the Committee and Congress to support the actions of the Administration toensure the President’s steel Section 232 tariffs are effective, and that the U.S. maintains the ability to produce all products critical to our national security interests, including the electrical infrastructure supply chain. In the case of a natural disaster or a cyber- or physical attack on the country’s electrical grid, the United States’ national security cannot be put in jeopardy due to the absence of a domestic supply chain that supports the key components of the electrical grid. If the U.S. ends up being reliant on foreign suppliers to repair a catastrophic failure of the electrical grid, the disruption to the nation’s businesses and citizens’ way of life would be unnecessarily long and burdensome. While the steel industry has taken the brunt of the unfair trade practices over the last several decades, no industry is immune, as we have seen with washing machines, solar panels and other manufactured products. It is only a matter of time before others are afflicted by unfair trade. This is why this Administration is to be commended and supported for its efforts to stand up for American workers and say enough is enough! We will no longer sit idly by and be taken advantage of! We must fight back to defend our industry and make American manufacturing stronger, given how critical manufacturing is to U.S. economic growth, and ensuring that Americans have jobs with family-sustaining wages that contribute to the health of our local communities across this great country.”

“We’ve already taken on the trade wars. We’ve already faced it. It’s been going on for decades. What we want is fair trade. We’ve seen it, as I gave examples, on electrical steel. And [just] because people were unfairly and illegally trading electrical steel, it doesn’t give them the right to buy that steel. What we want is fair trade, and if we can’t compete, that’s fine. I have no problem with that.”

BACKGROUND: Last week Rep. Kelly toured multiple factories in Pennsylvania’s Third Congressional District, including Sharon Crankshaft in Sharon, Wheatland Tube Co. in Wheatland, and AK Steel in Butler.