- The Washington Times - Thursday, March 7, 2002

ASSOCIATED PRESS
Major appliances such as a refrigerator or a washer-dryer pair could cost $3 to $5 more as a result of tariffs President Bush is imposing on steel products this month.
Steelworkers say that is a small price to save U.S. jobs and an industry that once was the backbone of U.S. commerce.
Americans need to think when they open their wallets "if this is an important and productive industry for America," United Steelworkers of America President Leo Gerard said yesterday.
Mr. Bush's three-year package a mix of quotas and tariffs of 8 percent to 30 percent on various products that will decline each year is structured to help the steel industry get back on its feet. Over the past few years, it has been battered by low-price imports.
Steel prices are at a 20-year low. More than 30 U.S. steel mills have filed for bankruptcy protection in the past four years.
From appliances, cars and homes to lawnmowers and desks, shoppers will "see a modest increase in all products that contain steel," said Jon Jenson, chairman of the Consuming Industries Trade Action Coalition, which campaigned against the tariffs.
Economists and analysts say the increases likely will range from 0.3 percent to 1 percent in cost.
A study by the coalition and the conservative Heritage Foundation estimated that 40 percent tariffs would have meant $283 more a year for a family of four.
Aaron Schavey, an author of that study, said the impact of Mr. Bush's tariffs will be less, but that "it's going to harm more people than it's going to help."
Even the price of some products not made of steel will go up. A Brookings Institution study found that nonsteel goods shipped in metal containers or made with steel machinery will be affected.
That study estimated that the highest increases would be in materials-handling equipment, farm construction and mining machinery.
"The average, everyday consumer is not going to be hurt because the price of raw steel just went up, but because raw steel is used in auto bodies, bus bodies, furniture and farm machinery," said Brookings Institution chief economist Allan Ingraham. Higher prices will mean a drop in consumer demand, he said.
But a Massachusetts Institute of Technology study says relatively little steel is used in many products, even automobiles. So consumers can expect smaller, modest price increases less than $2 for an American-made automobile. Such "minor price increases" would have virtually no effect on consumer demand, the study concluded.
Mr. Gerard said the sticker price of a $50,000 sports utility vehicle could go up $35.
Refusing to help the industry could mean that companies such as Bethlehem Steel Corp. would have to declare bankruptcy, with the assets sold in an auction, probably to international bidders, he said.
The company makes armored plates used in building and repairing U.S. battleships.


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