AISI Says State of the Union Speech "a Mixed Bag"

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For Immediate Release:
February 13, 2013 

Washington, D.C. – The head of the nation’s largest trade association representing steel producers today said that President Obama’s State of the Union speech laid out some positive goals, but fell short of specifics in proposing a robust manufacturing agenda.  Thomas J. Gibson, president and CEO of the American Iron and Steel Institute (AISI) made the following comments in reaction to the speech:

“We are pleased that the President seems to recognize the contributions of manufacturers like our nation’s steel industry to a strong economy.  And we were encouraged to hear him talk about the importance of growing manufacturing, enhancing our infrastructure and promoting fair trade.  However he didn’t provide many specifics about how his Administration is going to do those things. The speech was a mixed bag of admirable goals with uncertain outcomes, and was missing some important details.

“In the trade area, we appreciate the progress the Administration has made on trade law enforcement and the President’s commitment tonight to work toward leveling the playing field.  However, he fell short of recognizing the massive trade imbalance we have with China, and the fact that China operates with a built-in competitive advantage by undervaluing its currency.  China has at least 200 million tons of excess production capacity in steel – that is almost double the size of our entire domestic steel industry.  The President needs to take action to address the import surge we are facing in steel, including declaring China a currency manipulator and working with Congress to pass tougher trade enforcement legislation like the ENFORCE Act.

“On tax policy the President’s speech lacked a clear vision for how he will achieve tax reform that makes the United States -- which suffers from the highest corporate tax rates in the developed world -- more competitive.  While we praise the aspiration the President articulated to lower the corporate tax rate, and provide for an even lower rate for manufacturers, he also said that he would be ‘closing the tax loopholes for the wealthy and big corporations.’   These conflicting messages only compound the confusion on the Administration’s vision for corporate taxation.  The President must state with specificity how he plans to lower our corporate taxes, not just the nominal rate, to place U.S. manufacturers on a level playing field with our competitors around the world.

“We support the President’s goal of energy independence and harnessing clean energy; however, he needs to take concrete action by developing the full range of domestic energy sources.   One of the best ways the President could promote our energy independence would have been for him to lay out a plan to get the Keystone XL pipeline moving.  While he talked a good game on energy he again fell short by not articulating a real plan for the pipeline. 

“We also strongly agree with the President’s goal of rebuilding America’s infrastructure and are pleased to hear his commitment to funding a ‘Fix It First’ program focused on bridges and other critical repairs. Investments in surface transportation and water infrastructure directly impact the competitiveness of the manufacturing sector, create demand for steel fabricated products and create valuable jobs. This is an issue on which the President can show some real leadership and work with Congress to find ways to fund significant capital improvements.

“We are encouraged that some of the President’s proposals will benefit the steel industry, but are also disappointed that he did not lay out concrete plans to achieve the goals.   We will continue to work with the Administration and Congress to turn the rhetoric into action,” Gibson concluded. 

AISI serves as the voice of the North American steel industry in the public policy arena and advances the case for steel in the marketplace as the preferred material of choice.  AISI also plays a lead role in the development and application of new steels and steelmaking technology.  AISI is comprised of 25 member companies, including integrated and electric furnace steelmakers, and 124 associate members who are suppliers to or customers of the steel industry.  AISI's member companies represent approximately over three quarters of both U.S. and North American steel capacity.  For more news about steel and its applications, view AISI’s Web site at www.steel.org .


Contact: Lisa Harrison
202.452.7115  /  lharrison@steel.org 

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