TESTIMONY OF SENATOR HILLARY RODHAM CLINTON BEFORE THE INTERNATIONAL TRADE COMMISSION
Madam Chairman, thank you for giving me this opportunity to testify on behalf of the steel industry of New York and its workers. As you know, in September 2001, I submitted testimony to the International Trade Commission asking that the ITC make a finding that our domestic steel industry had suffered "serious injury" from cheap foreign steel imports. I had originally planned to deliver my September 2001 testimony in person before the Commission but following the tragic events of September 11, I spent a great deal of my time in New York and Washington, D.C. working on efforts to help New Yorkers who have been impacted by the terrorist attacks. Thus, I am especially pleased to be able to deliver my testimony in person before the ITC today to demonstrate my commitment to a strong domestic steel industry.
Madam Chairman, I strongly support continuation of the President's temporary import remedy. Allowing the relief to run for its full three-year term is essential to the continued recovery of the American steel industry and to the tens of thousands of jobs it supports. As our country faces difficult economic and international challenges, a vital, healthy domestic steel industry is important not only for the economic health of our nation, but for our national security as well.
As my September 2001 testimony described, New York has had a long history of providing steel for our national needs. In the late 19th and early 20th century the area around Buffalo was a heavy industrial base that included the nation's number one grain milling center. The Lackawanna Steel Co. mill, built in 1907, was for many years the largest and most modern mill in the world, and ushered in a new age of steelmaking in the United States
Yet New York, which was once a major steel producer, has seen mill after mill close as a result of dumped and subsidized imports. In 2001, our state was in danger of losing its last active steel mill, in Auburn, New York. Fortunately, Nucor Corp.
saw an opportunity to take advantage of the skills and dedication of Auburn's workers, and bought the Auburn mill.
Nucor's purchase of Auburn is just one example of the pivotal role New York is playing in reviving the U.S. steel industry
The President's Section 201 decision was based on the idea that, by limiting the ability of illegally traded imports to pour freely into the U.S. market, temporary import relief would make it possible for the domestic industry to attract the investment it desperately needed to fund consolidation and modernization. And indeed, this is exactly what happened. The International Steel Group, formed by Mr. Wilbur Ross, a resident of New York City, brought not one but three companies - LTV, Bethlehem, and Acme - out of bankruptcy. Mr. Ross was willing to invest hundreds of millions of dollars of his own money, and thousands of hours of his time, in turning these companies into efficient, low-cost producers of steel.
Other investors have followed his lead, and the domestic steel industry is finding itself able to raise capital on competitive terms for the first time in years.
The steel industry's workers have also invested heavily in the industry. As you can see, many steel workers are attending today's hearing, a testament to their commitment to the future of the steel industry. In fact, in terms of the sacrifices they have made, their investment dwarfs that of Wall Street. Millions of retired steel workers saw their pensions and health care benefits disappear as a result of unfairly traded imports. The workers remaining in the industry realized that their jobs depended upon being willing to adapt to new conditions. America's steel workers have agreed to dramatic changes in work rules and compensation, all to make the American steel industry more competitive. And they have succeeded, as the U.S. steel industry is establishing itself as an efficient, low-cost producer able to compete with any steel industry anywhere in the world.
Both investors and workers were willing to make difficult decisions because of the stability that the President's decision to provide import relief brought to the U.S. steel market. Both investors and workers are now counting on this Commission and the President to give them time to finish the job.
Eighteen months is not long enough to do this. While the domestic steel industry has made great strides in reviving itself since the President announced temporary relief, the process is still continuing. If investors are to obtain the returns they anticipated when they decided to invest in the industry, and if workers are to receive the appropriate rewards for their sacrifices, the industry must have the time it needs to complete the process.
Indeed, a newspaper report in yesterday's Wall Street Journal, supports the view that the industry needs the full three years. As you know, the world steel market is rife with excess foreign steelmaking capacity. Since large foreign markets such as Japan, China, Brazil and India are closed to foreign steel, the U.S. has become the prime target for those looking to sell off excess steel. The U.S. has been engaged in negotiations under the auspices of the Organization for Economic Cooperation and Development (OECD) to reduce worldwide excess steelmaking capacity.
According the article, while some progress has been made in reducing foreign government steel subsidies, Brazil, India, China and Turkey, among others, have resisted eliminating government subsidies which leads to worldwide steel overcapacity. With worldwide steelmaking overcapacity expected to continue for the near future, it is critically important that the Section 201 measures be allowed to run the full three years.
Finally, a healthy steel industry is necessary in order to ensure access to steel for our defense industry. We need to be able to guarantee that our military and defense industries will have access to the steel they need and are not overly reliant on foreign sources.
Madam Chairwoman, in conclusion, continuation of the temporary measures for the full three years will allow the domestic steel industry to reward its investors and its workers. In the end, the greatest beneficiary of all will be the U.S. economy as a whole.