Posted on 03/12/2018 10:25:15 AM PDT by Tolerance Sucks Rocks
The Trump administration’s new tariffs on steel and aluminum from abroad could result in more than five jobs lost for every single job gained, according to an analysis from a group that advocates free trade.
The job losses will be direct and indirect, as price hikes will hit American companies that buy international steel to make screws, wires, and machines, Laura M. Baughman, president of the Trade Partnership, said Friday during a Heritage Foundation event.
The Trade Partnership anticipates a net loss of 146,000 U.S. jobs, Baughman said.
On Thursday, President Donald Trump announced steel tariffs of 25 percent and aluminum tariffs of 10 percent. Trump was acting on a Commerce Department report that found steel imports were about four times what U.S. exports are. The Commerce Department further said aluminum imports increased to 90 percent of total demand for primary aluminum.
“When I first heard about these tariffs and the president’s motivation for them, I really had to agree that I thought this was really a proposal of his that was coming from the heart,” Baughman said.
“I can imagine it must be really hard to travel around the Midwest and coal country and everywhere during the campaign and see so many communities that have been decimated and unemployed workers, and the hardship that they are going through,” she added.
The Trade Partnership uses the same economic model as the Commerce Department. However, Baughman said only the job gains were noted in the Commerce report.
The tariffs will increase U.S. employment for the iron and steel sector—mainly for aluminum, according to the Trade Partnership study.
However, the consumer price hikes and price increases for business will cost 179,334 American jobs for the rest of the economy.
There would be more than 36,000 American jobs lost in the manufacturing sectors, including a loss of more than 12,000 jobs for fabricated metals, more than 5,000 lost for motor vehicles and parts, and more than 2,100 in transportation equipment makers, according to the report.
The Trump administration and many labor unions contend that too many imports kill American jobs.
Baughman responds, cheap imported goods might cause job losses, but technology, consumer demand, and other economic changes are also responsible for unemployment in certain sectors.
“It’s so much easier, especially for politicians, to point to foreigners as the cause of all of our ills and therefore call import protections as the solution,” Baughman said. “Way more easier than it is to say, ‘Well, I’m going to take away your technology so that you can have your job again.’”
The tariffs Trump announced would have little impact on China or Russia, said Tori Whiting, a trade economist with The Heritage Foundation.
“The administration has said time and time again that China is the issue with steel, maybe Russia is the issue with steel,” Whiting said during the panel discussion Friday. “These tariffs will not do much, if anything, to impact our imports from China. Two percent of all U.S. steel imports come from China. That’s a statistic from 2016. That number has decreased significantly over the past five to six years because of anti-dumping and countervailing duties that have all but cut off a lot of imports of steel from China.”
Small business will be the hardest hit, said Vanessa P. Sciarra, a vice president with the National Foreign Trade Council.
“If you are a big company, say you are a big beverage manufacturer, you probably can jump and make other supply arrangements,” Sciarra said at the Heritage event.
“But if you are a small fabricator in Michigan or Ohio, and you use a foreign metal because it has been price attractive for you to do that or there has been some relationship you have with this supplier, those supply chains are going to be cut off by these increase tariffs,” she said. “You are going to have a hard time jumping to new sources of supply.”
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They might be upset to find the U.S. is likely to kill multiple birds with a single stone by lowering energy cost, negating the carbon argument, and making raw materials less expensive with a single move. Cost of energy remains the primary limitation restricting economic growth.
Last month a grant was established to underwrite development of a synthesis gas project to be located in North Dakota for utilization of varied grades of coal as an additional fuel source for Allam Cycle power generation. The first pilot plant located near Houston has focused upon testing with natural gas as the fuel. The coal process as fuel source for this specific system will now be developed.
In the context of selling bulk pipeline grade CO2 for boosting oil and gas recovery, atmospheric gases from dedicated air separation units, and chemical feed-stock recovered from fuel processing and combustion gas scavenging, LCOE for NG operation has been calculated to be possibly as low as $9 per MW of electricity produced, under ideal market conditions. Straight-up electrical generation cost without secondary product income sources is projected as $42 per MW.
In Kingsport Tennessee, Eastman Chemical operates three gasification plants using nearby SW Virginia coal.
They were designed by close Jaycee friends of mine and at least one close friend was an operations engineer there. They have been running since 1980.
Eastman has several turbines producing electricity. They recently converted one to natural gas from coal.
With gas so cheap, one wonders if the North Dakota project will be profitable
Raw steel and aluminum imported by NAFTA partners, subsidizes the production of products which enter the U.S. duty free.
The ND project will examine if any modifications to the combustor will be required for stability of fuel burn, and evaluate any corrosion issues from burning raw unscrubbed syngas. The syngas unit will be an integral part of a power generating plant using coal as a fuel feed source.
This turbine differs from a typical jet engine in that the primary working fluid is CO2 at about 400 bar pressure. A fuel gas and pure oxygen mixture, diluted with about 95% CO2 is burned within specialty combustor cans. The construction uses specialty high nickel alloys for the inner turbine components, to counter the combined heat and corrosion aspects presented in operation.
The syngas operation will explore use of varied compositions of coal including lignite. As the pure NG fueled Allam Cycle turbine is rated for sour gas contaminated operation, an examination of components tested under conditions of use with syngas containing acid precursor contaminants and minor water content will be undertaken.
Within the turbine, additional water results from the combustion of fuel; and, will transform oxides of nitrogen and sulfur to acids once condensation occurs within the cooler water separation part of the system. Combustion product scrubbing from the produced water results in a chemical feed-stock and pure water output. A minor amount of the 30 bar pure CO2 is diverted to feed a pipeline pumping unit.
If those are government jobs than we're headed in the RIGHT direction.
Uh huh - and the Globull warming folks keep telling us we all died out 12 years ago....
“Raw steel and aluminum imported by NAFTA partners, subsidizes the production of products which enter the U.S. duty free.”
But the actual tariffs on the NAFTA partners is going to be extremely less to nil.
You are using an example where government imposed mandates on improving MPG, not cost benefit, was the reason for the decision
Steel and Aluminum fill a niches in industrious because they produce benefits in strength and low weight that no other alternative can match. The market has all ready weight the cost benefits and both Steel and Aluminum win that battle. There isn’t a ready alternative to either that works nearly as well as they do.
Agreed.
Nonsense.
Never, ever make this assumption for any material that has a commercial application. Industries are constantly conducting research to develop new composite materials that are cheaper, stronger and/or more durable than the ones they're using. Look how many materials are commonplace today that didn't even exist a few decades ago.
Just in the last couple of days there was an article posted here about a company that had figured out a way to produce heat-treated compressed lumber that is comparable in strength to steel for some building applications -- at a much lower cost.
Think about what you are saying. IF your theory holds, why haven’t they all ready switched to these replacement materials?
1. Steel is still cheaper AT ITS CURRENT PRICE.
2. It's one thing to develop a viable alternative material. It takes some time to ramp up production so it can be mass produced in sufficient quantities to price it for economies of scale.
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