The Truth About Trump’s Steel Tariffs

His first-term levies hurt consumers and U.S. manufacturers

WSJ editorial. Excerpts:

"most U.S. metal imports came from allies including Canada, Mexico, Europe, South Korea and Japan."

"U.S. production was already increasing amid a surge in capital investment unleashed by his deregulation and 2017 tax reform. U.S. steel capacity utilization climbed to 78.5% in March 2018 from 72.4% in December 2016."

"Consider Mid-Continent Steel and Wire, which produced roughly half of the nails made in the U.S. After the steel tariffs took effect, its sales plunged by more than half, causing it to lay off 80 workers. Another 120 quit because they worried its Missouri factory might close. After this damage, the Commerce Department granted the company a tariff exemption."

"Ford Motor said tariffs subtracted $750 million from its bottom line in 2018"

"GM said the tariffs dented its profits by some $1 billion"

"The tariffs also made U.S. manufacturers less globally competitive and prompted retaliation that hurt American businesses. Canada imposed tariffs on $12.8 billion in U.S. products, including 25% on steel and 10% on aluminum."

"Employment in durable goods manufacturing began to decline in early 2019, which reduced demand for steel and aluminum. Employment in fabricated metals manufacturing that used steel and aluminum plunged and is still some 35,000 lower than when the tariffs took effect."

"Domestic steel-making capacity utilization has fallen back to 70%, about the same as in 2016."

"steel prices are about 50% higher than pre-pandemic levels and aluminum prices a third higher."