Domestic steel manufacturers have long complained they face unfair competition from other countries whose exports to the U.S. are subsidized by foreign governments. But a new report from the American Institute for International Steel shows that domestic steel producers have received billions of dollars in public subsidies.

• For instance, a 1999 federal law provides for up to $1 billion in loan guarantees to steel companies unable to obtain credit for continued operations and reinvestment.

• A 1988 federal law gives about $155.4 million to fund research and development to increase the energy efficiency and enhance the competitiveness of steel.

Also, states and localities have been a lucrative source of subsidies. Among them:

• In 1997, Illinois began paying out at least $2.7 million in incentives for the Hanna Steel Corp. to build a steel-processing plant in Pekin.

• In 1997, Maryland initiated a program estimated to cost at least $75 million in grants and low-interest loans to Bethlehem Steel to build a facility at Sparrows Point.

• Between $85 million and $112 million flowed from Alabama taxpayers in 1994 as an incentive to Trico Steel Co. to open a minimill in the Decatur area.

Source: Robert Guy Matthews, "U.S. Steel Industry Gets Billions in Public Subsidies, Study Concludes," Wall Street Journal, November 29, 1999.

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