Administration Moves to Defeat Steel Quota Bill

The Clinton administration made an eleventh-hour push Monday to defeat a controversial steel quota bill, decrying the threat of a trade war and scurrying to launch several new anti-dumping investigations.

The legislation, which would impose strict limits on steel imports, faces a close vote in the Senate today.

Commerce Secretary William Daley warned that the bill could harm the economy and might even backfire on U.S. steelmakers if a trade war were to erupt.

“This quota bill would violate our international trade obligations and give other countries the right to retaliate--perhaps by keeping out those U.S. exports that use American steel,” Daley told a news conference outside the Senate.

“The last thing we need to do is put our domestic steel industry--as it rebounds from last year’s crisis--right in the middle of an international trade war,” he said.

Daley also announced new anti-dumping investigations involving cold-rolled steel, a product used to make auto body panels and household appliances. In launching the probes, the administration is trying to show it is doing its part to help an industry hit by a flood of imports stemming from the global economic crisis.

The new investigations for cold-rolled steel concern imports from 12 countries: Argentina, Brazil, China, Indonesia, Japan, Russia, Slovakia, South Africa, Taiwan, Thailand, Turkey and Venezuela.

Those cases follow earlier probes into hot-rolled steel products that have resulted in duties on Japan and negotiated deals to limit imports from Brazil and Russia.

While Daley made a public case for defeat of the steel bill, administration officials have been privately lobbying senators to try to sway them to their side.

“We’ve been in discussions for the last number of weeks with a number of senators and I don’t have a fresh vote count to give you,” Daley said. “It’s a difficult vote, no question about it.”

The steel bill, a version of which has already passed the House, would limit steel imports for three years to return them to a more historic 20% of the U.S. market. Many Democratic senators support it, with the main opposition coming from Republicans. Advocates on both sides have said today’s vote is hard to call.