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Lakes Maritime Task Force Urges Hearings On Steel Issues
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In position papers circulated in Washington, the task force called for "immediate" hearings on legislation targeting unfairly priced foreign-made steel in U.S. markets and reaffirmed its support of the 1920 Jones Act and the 1886 Passenger Vessel Services Act, the cabotage statutes that hold domestic maritime markets for vessels owned, built, registered and crewed in the U.S. In the steel trade paper, the task force urged specifically that H.R.808 be brought quickly before the appropriate Congressional panels for deliberation. The bill, sponsored by Rep. Peter Visclosky (D-IN), would impose fines on shippers of foreign-made steel sold in the U.S. at or below the cost of production or below the sale price in the producing country--an illegal practice. The penalties would be used to help fund health care benefits for retired steelworkers. However, the task force also recommended prompt consideration of "other measures" crafted in the House and Senate in response to surging levels of unfairly traded steel imports in domestic markets. The task force paper said steel imports spiked to "a new record" of 42 million tons in 1998. Imports fell in 1999 to 35.6 million tons, but rose again in 2000 to 38 million tons. Much of the imported steel was priced artificially low, the paper added. "Even though the American steel industry is the most efficient in the world, this continuing tidal wave of dumped steel has led to production cutbacks, reduced work-weeks, layoffs, and even permanent shutdowns" of some plants. "No less than 16 American steelmakers are currently in bankruptcy and reorganization." Consequent diminished demand for iron ore has harmed the U.S.-flag Great Lakes bulk fleet, which employs AMO engine and deck officers and stewards. The fleet relies upon the steel industry for its core cargoes. The 1998 shipping season was shortened, and 1999 saw the first significant decline in U.S.-flag iron ore carriage since 1991. In 2000, the U.S.-flag iron ore float was down 2.2 percent to 113.1 million tons. In its position paper, the Great Lakes Maritime Task Force noted that the domestic basic steel and iron ore industries are found in Minnesota, Michigan, Indiana, Ohio, Illinois and Pennsylvania. "Prior to the onslaught of dumped steel, direct employment at the mines and mills (in those states) provided 125,000 family-sustaining jobs. Using a conservative multiplier effect, more than 500,000 jobs depend on a healthy steel industry. Specific to the Great Lakes U.S.-flag fleet, iron ore, coal and fluxstone carried for steelmakers likely represent 80 percent of all cargo moving in Jones Act lakers." The task force was careful to distinguish between "fairly traded" steel imports, which supplement domestic production, and dumped imports, which undermine essential U.S. firms. "Fairly traded steel creates jobs for American longshoremen and, as an inbound cargo (through the St. Lawrence Seaway), keeps freight rates for grain exports competitive with the coastal ports," the position paper said. "The Great Lakes Maritime Task Force does not seek curbs on fairly traded steel." In its domestic shipping position paper, the task force said it will continue to oppose efforts to "repeal our existing cabotage laws." The task force said it will also oppose bids by foreign interests to include the Jones Act and Passenger Vessel Services Act as bargaining items in negotiations possibly leading to an expanded North American Free Trade Agreement, a revised U.S.-Canada Free Trade Agreement, and a multilateral service trade agreement pursued through the World Trade Organization. In addition, the Great Lakes Maritime Task Force will continue to oppose trade-specific Jones Act waivers. "While exemptions to the Jones Act are allowed during national emergencies, peacetime exemptions for commercial vessels must not be permitted," the task force paper said. "If an economically viable trade develops that requires a new type of U.S.-flag vessel, there will be fierce competition for the business without changing the cabotage laws." The Jones Act and Passenger Vessel Services Act cover more than 1 billion tons of cargo and 100 million passengers between and among U.S. ports each year. However, Jones Act shipping costs amount to less than two percent of the total annual U.S. freight bill. The Jones Act ocean-going, Great Lakes, and inland fleet has more than tripled in size to more than 37,000 vessels of varied size and design since 1965, and domestic shipping productivity has risen four-fold in the same period. Moreover, the Jones Act, the PVSA, and comparable cabotage laws applied in domestic towing and salvage trades ensure the Department of Defense a permanent pool of qualified civilian seagoing labor for strategic sealift and other services in a conventional war overseas. "For these and other reasons, every administration since 1920 has strongly endorsed the Jones Act, and the Navy terms the law 'vital to our national security,'" the task force paper said. In other position papers, the Great Lakes Maritime Task Force:
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