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Eye On Mining: Local unions, economists react to tariffs on U.S. allies

A fight decades in the making.

"In the steel industry, and with United Steelworkers, we’ve been in a trade war for over 20 years," said John Arbogast, President of USW Local 1938.

The culprit? Illegal steel dumping.

"When this cheap steel gets dumped in this country it affects the Iron Range because then other companies are buying the cheap steel and then there’s no demand for our steel. Then we end up getting laid off," said Arbogast.

Economists, like Dr. Tony Barrett, agree that countries who cheat in trade need tariffs.

"The fundamental problem with trade is China, they don’t follow the rules that they’re supposed to. With steel in particular they are the source of overcapacity that puts that industry under strain," said Barrett, who is an Economics Professor at the College of St. Scholastica.

But President Trump’s recent decision to impost tariffs on U.S, allies is another story.

"I see nothing to gain politically, I see nothing to gain economically by imposing tariffs on Canadian-made steel and aluminum," said Barrett. "They’re not the problem, Europe is not the problem, Mexico is not the problem, so I was surprised because that is going to hurt us."

Arbogast has been involved in the United Steelworkers Union for 24 years. 
He says the union does not support President Trump placing tariffs on U.S. allies,
but he’s seen first hand what illegally dumped steel can do to an area like the Iron Range.

"It’s hard to imagine that you have to put a flier out in the plant letting people know we’re going to meet and we have to update them and tell them at the end of the month you won’t have a job, we don’t know when your job is going to come back, we don’t know anything."

That’s exactly what he had to do when Iron Range mines were forced to layoff workers in 2015.

"To sit there in front of a thousand people and try and tell them that kind of news is very, very hard. It’s gut-wrenching."

While Barrett said this isn’t the way most people would address the problem, other tactics have fallen short.

"Previous administrations going back to George Bush, even further back to Bill Clinton, realized this was a problem and whatever approach they were following wasn’t solving it, so maybe this will."

After a difficult decade for the steel industry Arbogast is hopeful relief is in site.

"We know it’s a cyclical industry up here and hopefully with some of these steps the government is taking, hopefully we can get back on our feet again and have a fair playing field."

Dr. Barrett added that while he expects the economy to stay strong for the remainder of 2018, the possibility of a trade war could make for a difficult 2019. 


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