AISI Encourages Congress to Act on Tax Policy, Energy and Currency Manipulation

Joe Carrabba, AISI Chairman and CEO of Cliffs Natural Resources, Inc., told the subcommittee that the American steel industry needs tax policies that will make U.S. firms more competitive globally.

“Achieving a lower overall statutory tax rate should not come at the expense of higher effective tax rates for the businesses and industries that most support capital investment, job growth and value-added manufacturing,” said Carrabba. On infrastructure, Carrabba said, “I urge you all to view federal support for roads, bridges, ports and rails, not as expenditures, but as investments in the competitiveness of our nation.”

Nucor CEO and President John Ferriola encouraged policy makers to enforce “trade laws to ensure our system of free trade is working fairly.”

Mike Rippe, President and CEO of ArcelorMittal USA LLC addressed the steel industry’s challenge of meeting environmental and fuel economy standards. “I’m here today to tell you that steel is meeting that challenge,” said Rippe. “We would urge the Subcommittee to make sure that…regulations measure the full impact of materials on the environment, from cradle to grave, over their `life cycle’.”

John Surma, Chairman and CEO of U.S. Steel discussed energy development and the economic promise of the shale gas revolution: “The energy sector has been a rare bright spot for [steel] during a challenging period of economic recession and slow growth in the rest of the economy.”

Mike Rehwinkel, President and CEO of EVRAZ North America stressed the need for a “reasonable, streamlined regulatory approval process for the construction and permitting of new facilities or modernization of existing ones.”

Rehwinkel used the Keystone XL Pipeline as an example: “It will provide a competitively-priced, reliable North American supply option for Gulf Coast refineries and has met extensive regulatory approvals; yet it is being delayed. This is undermining the goal of secure, stable energy supplies in our country.”

Currency Reform

AISI urged members of Congress to support legislation introduced on Wednesday by Representatives Tim Murphy (R-PA), Sander Levin (D-MI), Tim Ryan (D-OH) and Mo Brooks (R-AL) that targets currency manipulation export subsidies.

“Currency manipulation to gain an unfair competitive advantage is among the most destructive trade-distorting practices used today,” said Thomas J. Gibson, president and CEO of AISI. “While China has been the largest offender, in today’s weak global economy an increasing number of governments are manipulating their currencies to insulate their domestic producers. This is devastating to U.S. domestic manufacturers – especially the steel industry — and is contributing to the nation’s inability to fully recover from the recession.”

Bills similar to “The Currency Reform for Fair Trade Act” introduced last week have been presented to the House and Senate in previous years—passing in the House in 2010 and the Senate in 2011—but have not won final congressional approval. The legislation gives U.S. manufacturers the ability to use the existing countervailing duty law to seek remedy for injuries caused by currency manipulation. AISI, along with other manufacturing associations such as the Alliance for American Manufacturing, hope that 2013 will be the year for reform.

“China’s overcapacity is two-and-half times the size of our entire domestic steel market. We greatly appreciate the efforts of Representatives Murphy, Levin, Ryan and Brooks to introduce this legislation signaling that Congress is not going to sit idly by while China and others refuse to play by the rules,” said Gibson.