Minnesota’s legendary Iron Range is blessed with the largest deposits of iron ore in North America. Generations of workers in northern Minnesota have mined and upgraded over a billion tons of high-grade iron ore pellets, which are used across this great nation to make the iron and steel products that underpin both our national and economic security.
On the national security front, American steel is a key ingredient of many of our major weapons systems. There are 22 tons of steel plate in every Abrams tank, 10,000 tons in every Trident Class nuclear submarine, and over 50,000 tons in each of our aircraft carriers.
On the economic security front, our mining and steel industries provide good jobs at good wages for tens of thousands of Americans. In Minnesota alone, according to the U.S. Bureau of Economic Analysis, durable manufacturing accounts for nearly $15 billion in salaries and wages. Estimates suggest that the steel industry is responsible for almost $1 billion of these wages, with more than $500 million of that solely in the northland. This economic activity is supported by a strong state educational system of technical and vocational schools and supports a supply chain of hundreds of businesses in more than 200 communities across Minnesota.
Minnesotans know all too well that the state’s Iron Range has always been subject to booms and busts. However, the years 2015 and 2016 marked one of the worst downturns in decades as foreign nations such as China and the United Arab Emirates flooded American markets with dumped, subsidized steel and steel products.
With one stroke of his pen, President Donald Trump turned the fortunes of Minnesota’s Iron Range around. In March of 2018, under Section 232 of the Trade Expansion Act of 1962, President Trump implemented a 25% tariff on a broad swath of foreign steel imports. The Trump tariffs have turned out to be effective trade actions, generating their intended effects — and creating a boon for Minnesota in the process.
Evidence for the effectiveness of the tariffs abounds. Since these tariffs were imposed, domestic capacity utilization, which is critical to industry sustainability, has increased to levels not seen in the last decade. Even as steel shipments rose 5% in 2018, steel imports fell by 4 million tons, with 90% of the decrease taking place after the tariffs were fully implemented.
Several strong buy-American executive orders are also boosting the use of American iron and steel in government procurement. And it is not just Minnesota’s miners who are back at work. Employment is up in virtually every segment of the steel industry, from metal foundries and metal valve manufacturing to pipe and tube production and the rolling and drawing of purchased steel. Meanwhile, industries that depend on steel have also seen significant employment gains, defying the dire predictions of those critics of the Trump tariffs who forecast that the tariffs would herald net job losses in downstream industries.
Our work to restore and strengthen America’s security and manufacturing base is far from done. That’s why, on Sunday, as a symbol of the strong partnership between the White House and supporters of the president’s trade policies on Capitol Hill, we will jointly host a stakeholder-driven roundtable in Duluth to hear from the miners and industry leaders benefiting from this administration’s focus on the American worker.
One topic that will surely come up will be the proposed replacement for NAFTA — one of the worst trade deals in American history. Our message to the people of Minnesota will be this: the proposed United States-Mexico-Canada Agreement (USMCA) is a great deal not just for the men and women who work in our great factories but also for all of those farmers and ranchers who want to export more of their products.
The USMCA will ensure greater access to the Canadian market and lower barriers for our agricultural products in both Mexico and Canada. Strong regional and labor value content rules and comprehensive and enforceable labor and environmental obligations will help bring manufacturing jobs back onshore. The United States Trade Representative estimates that over a five-year period, the USMCA will result in $34 billion in new automotive manufacturing investments in the United States; $23 billion in new annual purchases of U.S.-made automotive parts (including additional steel and aluminum purchases); and 76,000 jobs in the U.S. automotive sector.
We say it’s time for Congress to pass the USMCA in its current form and thereby put the U.S. in a better trading position in North America. American workers can compete with anyone if policies are put in place for truly free, fair and balanced trade. That’s a key goal of both Congress and the Trump administration, and we want to hear from you.
Pete Stauber, a Republican, represents the Eighth Congressional District of Minnesota in the U.S. House. Peter Navarro is assistant to the president for trade and manufacturing policy in the Trump administration.