U.S. Steelmakers Get Billions In Government Subsidies
November 29, 1999
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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