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‘We Need Stimulus Now!’ American Steel Makers Tell Obama
Hard-hit steel makers, facing a dramatic downturn in orders and massive layoffs, want President-elect Obama to mandate that infrastructure projects use American steel as a condition of his proposed economic stimulus plan.
(CNSNews.com) – The U.S. steel industry, with demand for its products in the doldrums, has joined the chorus of beleaguered domestic industries jostling for position on President-elect Barack Obama’s list of projects in his promised multi-billion dollar national economic stimulus plan.
Steel Manufacturers Association President Thomas Danjczek said that a stimulus package is needed immediately, but stressed that this was not a call for a Detroit-style bailout.
“We need stimulus now,” he told CNSNews.com. But, he added, “I represent 70 percent of the U.S. steel industry and none of my members are looking for a bailout.”
He said that large infrastructure projects would greatly benefit the steel industry, as orders for raw materials increased as those projects got started.
“Producers of steel rebar, plate, beams, and wire rod should all see an increase in orders once projects are under way,” Danjczek said.Steel rebar, plate, and beams are all materials used in modern highway and commercial construction -- the type proposed by Obama.
Facing a 51.6 percent decline in manufacturing production, seen almost entirely since September, representatives of the nation’s steel producers are working with Obama’s transition team to identify projects that are steel-intensive and ready to go.
“We have been in initial talks with his transition team folks, we’ve indicated that our companies would be ready and willing with high-quality, domestic steel,” Nancy Gravatt, spokesman for the American Iron and Steel Institute (AISI) said.
The U.S. steel industry currently employs approximately 1.2 million people and contributes $350 billion to the national economy, according to AISI.
Obama’s stimulus plan should be focused on large, infrastructure-related projects that benefit not only U.S. steel makers but all domestic industries in general, Danjczek said, saying that the need was for a national strategy to get the economy back on track.
“The importance of a national strategy can’t be overstated,” he said. “Even in the short term, this represents an opportunity to create thousands upon thousands of high-paying jobs that cannot be outsourced.”
“It most certainly will have a positive impact on our currently underfinanced transportation systems to help U.S. manufacturing,” he added.
The Steel Institute’s Gravatt agreed, saying that large projects would help the entire country, not just U.S. steel makers, a point on which Obama’s economic team agrees.
“That was one of the things that his (Obama’s) team is doing is identifying those kinds of projects as the priority ones, the ones that are ready to launch immediately,” she said. “That would produce the kind of results which, I think, would be helpful to the economy.”
Both Gravatt and Danjczek called for any stimulus plan to have a “Buy American” clause mandating that materials be produced by American companies.
“We most certainly advocate that a “Buy American” clause be part of the stimulus package,” Danjczek said. “The point is to spend it efficiently here to create jobs, not elsewhere.”
“That’s a provision that’s been in law for a lot of years, and our industry has traditionally supported it,” Gravatt said.
Not everyone shares the views of the steel industry. Free-market economist Lew Rockwell, president of the libertarian Ludwig von Mises Institute, said that stimulus is just another name for spending -- spending that will eventually result in inflation and higher taxes on future generations.
“The government really has no money of its own, it only has what it takes from other mainly productive enterprises and productive individuals to give to the failures,” Rockwell explained. “All the money that has been created will already cause a lot of inflation.”
“The only thing they can do to stimulate the economy is to cut themselves,” he said. “That is, to cut government spending, to cut government taxes, to cut government regulations. But of course their doing everything in the opposite (direction).”
Rockwell compared Obama’s proposed stimulus package to the actions taken by former Presidents Herbert Hoover and Franklin Roosevelt during the Great Depression of the 1930s.
“What Obama is doing is exactly like what Franklin Roosevelt and Herbert Hoover did -- making sure that this horrible recession turns into another depression,” Rockwell said.
A steelworker arrives for the second shift outside the United States Steel Corp's. Edgar Thomson Works in Braddock, Pa., Monday, Nov. 17, 2008.
Steel Manufacturers Association President Thomas Danjczek said that a stimulus package is needed immediately, but stressed that this was not a call for a Detroit-style bailout.
“We need stimulus now,” he told CNSNews.com. But, he added, “I represent 70 percent of the U.S. steel industry and none of my members are looking for a bailout.”
He said that large infrastructure projects would greatly benefit the steel industry, as orders for raw materials increased as those projects got started.
“Producers of steel rebar, plate, beams, and wire rod should all see an increase in orders once projects are under way,” Danjczek said.Steel rebar, plate, and beams are all materials used in modern highway and commercial construction -- the type proposed by Obama.
Facing a 51.6 percent decline in manufacturing production, seen almost entirely since September, representatives of the nation’s steel producers are working with Obama’s transition team to identify projects that are steel-intensive and ready to go.
“We have been in initial talks with his transition team folks, we’ve indicated that our companies would be ready and willing with high-quality, domestic steel,” Nancy Gravatt, spokesman for the American Iron and Steel Institute (AISI) said.
The U.S. steel industry currently employs approximately 1.2 million people and contributes $350 billion to the national economy, according to AISI.
Obama’s stimulus plan should be focused on large, infrastructure-related projects that benefit not only U.S. steel makers but all domestic industries in general, Danjczek said, saying that the need was for a national strategy to get the economy back on track.
“The importance of a national strategy can’t be overstated,” he said. “Even in the short term, this represents an opportunity to create thousands upon thousands of high-paying jobs that cannot be outsourced.”
“It most certainly will have a positive impact on our currently underfinanced transportation systems to help U.S. manufacturing,” he added.
The Steel Institute’s Gravatt agreed, saying that large projects would help the entire country, not just U.S. steel makers, a point on which Obama’s economic team agrees.
“That was one of the things that his (Obama’s) team is doing is identifying those kinds of projects as the priority ones, the ones that are ready to launch immediately,” she said. “That would produce the kind of results which, I think, would be helpful to the economy.”
Both Gravatt and Danjczek called for any stimulus plan to have a “Buy American” clause mandating that materials be produced by American companies.
“We most certainly advocate that a “Buy American” clause be part of the stimulus package,” Danjczek said. “The point is to spend it efficiently here to create jobs, not elsewhere.”
“That’s a provision that’s been in law for a lot of years, and our industry has traditionally supported it,” Gravatt said.
Not everyone shares the views of the steel industry. Free-market economist Lew Rockwell, president of the libertarian Ludwig von Mises Institute, said that stimulus is just another name for spending -- spending that will eventually result in inflation and higher taxes on future generations.
“The government really has no money of its own, it only has what it takes from other mainly productive enterprises and productive individuals to give to the failures,” Rockwell explained. “All the money that has been created will already cause a lot of inflation.”
“The only thing they can do to stimulate the economy is to cut themselves,” he said. “That is, to cut government spending, to cut government taxes, to cut government regulations. But of course their doing everything in the opposite (direction).”
Rockwell compared Obama’s proposed stimulus package to the actions taken by former Presidents Herbert Hoover and Franklin Roosevelt during the Great Depression of the 1930s.
“What Obama is doing is exactly like what Franklin Roosevelt and Herbert Hoover did -- making sure that this horrible recession turns into another depression,” Rockwell said.
