Pipe Made in India Incenses Illinois Town

A steel town whose factories are idled is not likely to welcome steel pipe from India in its backyard. And from the citizens’ initial reactions in an Illinois town, it’s not hard to see how a grassroots protectionist campaign could find strong support. But, as this article details, the issues are much more complex. First, the US has been importing 20 percent or more of its steel needs for the last ten years. Second, the United Steelworkers union endorses free trade. The issue, as the Union contends, is fair trade: India and China provide subsidies to their industry sufficiently high as to allow them to offer low prices. Anti-dumping filings have been one method to counteract such competition. Environmentalism too comes in handy. Siding with the Sierra Club, the union challenges permits for projects that would employ thinner, and thus potentially unsafe, pipe from India. Yet, steel buyers argue that there isn’t enough domestic capacity to meet their needs. The debate, which centers on ‘fair trade’, suggests that the reality of a globalized world makes it harder to challenge free trade without violating the WTO. Fair trade is a subjective term that can be invoked without any legal implication. – YaleGlobal