U.S. ‘can’t fight a war’ without American steel, Trump tariff chief says
U.S. Commerce Secretary Howard Lutnick on Wednesday defended the doubling of steel and aluminum tariffs by claiming the United States “can’t fight a war” without domestic production of those materials.
Lutnick made the comments while denying the immediate real-world implications that steep tariffs will have on U.S. manufacturing during testimony in front of the U.S. Senate appropriations committee that focused in part on U.S. President Donald Trump’s tariff policy.
“The big issue is, you can’t fight a war without steel and aluminum production in America,” Lutnick said during an exchange with Democratic U.S. Sen. Jeanne Shaheen of New Hampshire, who was asking if he or Trump consulted with the Pentagon before raising those tariffs.
“If you don’t have the ability to make your own steel and aluminum, you can’t fight a war, and that is what the president’s doing. He’s trying to make sure that we make sufficient steel and aluminum to protect our defence.”
“Which I certainly support,” Shaheen said, to which Lutnick replied, “Sounds like we exactly agree.”
“But I don’t agree on the way it’s been done,” Shaheen responded, “because we’re not going to have the steel that we need immediately to provide the supplies that we need immediately. So we need to do a little better planning before we put in place those kinds of tariffs.”
Trump signed an executive order Tuesday that raised tariffs on steel and aluminum imports from the 25 per cent rate first imposed in March to 50 per cent, effective Wednesday.
In her exchange with Lutnick, Shaheen highlighted concerns from a ball bearing manufacturer in her state that supplies the U.S. aerospace industry.
While she didn’t name the company, she said it has only one domestic steel supplier, with the rest of its materials sourced from Canada and the Indo-Pacific.
“Those (foreign suppliers) have been eliminated under the tariffs,” she said, adding that the company is facing both rising costs and production lead times that have grown from 20 weeks to two-and-a-half years.
“What was the determination about how you address those kinds of extended lead times for companies that are producing equipment that’s critical to our national security?” she asked.
“It’s really a cost issue, not an access issue,” Lutnick replied.
“Not according to this company in New Hampshire,” Shaheen said. “It’s an access issue for them.”
“Well, that would be illogical since it’s just a tariff, which is monetary,” Lutnick said. “It’s not a sanction. It’s just a monetary one.”
Canadian steel and aluminum producers — as well as other sectors affected by Trump’s various tariff regimes, like automakers — have said higher price points for their products have led to cancelled U.S. contracts.
The Canadian Steel Producers Association has said the newly-increased tariffs are “creating chaos and disruption throughout North American supply chains and delivering a crushing blow to the Canadian steel industry.”
“At a 25 per cent tariff rate, we saw significant layoffs, curtailed investments and a significant drop of shipments to the United States,” president and CEO Catherine Cobden said in a statement Wednesday.
“At a 50 per cent tariff rate, the U.S. market is effectively closed to Canadian steel, leaving billions of dollars of Canadian steel without a market.”
Trump and Lutnick have said tariffs on countries and industries are meant to drive manufacturing back to the U.S. by raising the cost of foreign goods.
The tariffs on steel and aluminum specifically were imposed under national security concerns. Trump administration officials have focused particularly on China, warning Beijing could cut off supplies if the trade war escalates or in the event armed conflict breaks out.
White House economic advisor Kevin Hassett told ABC News on Sunday that China is “dumping” cheap steel products into the U.S. and other countries “because it prepares them to win a war, because they’re the only ones who can make steel.”
“If we have cannons but not cannonballs, then we can’t fight a war,” Hassett said. “We have to have a steel industry that’s ready for American defence.”
U.S. defence and aerospace manufacturers have relied on Canadian steel and aluminum for decades — including in wartime.
Canada supplied raw materials, components and fully built military vehicles and equipment to the U.S. during the Second World War, helping to bolster American military forces. It later did the same for U.S. forces in the Korean, Vietnam and Middle East wars, as it has for Britain and other allies.
To this day, Canadian steel and aluminum is used to build American aircraft, missiles, space technologies and other equipment.
The Canadian government has vowed to bolster its own domestic defence industry with Canadian-made steel and aluminum in an effort to protect those industries from Trump’s tariffs and move away from U.S. reliance.
Defence Minister David McGuinty told a conference of defence contractors last week that the government’s goals for boosting the Canadian sector will match the speed at which production ramped up during the Second World War.
Lutnick on Wednesday continued to insist that higher tariffs and related costs are a separate issue from supply, and even offered to explain “how steel works” to Shaheen after the public testimony.
“The company that I’ve been talking to in New Hampshire understands how it works,” Shaheen responded, “and they have a problem. They don’t need you to explain it to them. They know because they’ve been in business for years.”
globalnews
