SEATTLE (Scrap Monster): The American Iron and Steel Institute (AISI) has released the Public Policy Agenda for 2017, which is aimed to address the concerns of manufacturing sector. The document highlights the need for a pro-manufacturing policy agenda to fight global steel overcapacity and job losses to local communities.
According to AISI, the excessive imports of cheap steel product from other countries has resulted in job losses and steel plant closures across the country. The government must focus on efforts to force other countries, especially China, to reduce their steel overcapacity. In addition, the Institute also called upon the administration to aggressively enforce recently strengthened US trade remedy laws to counter unfair trade practices. The Commerce Department must be directed to use its existing powers under the countervailing duty (CVD) law to offset the export subsidy caused by currency manipulation by foreign governments. Further, any new or updated trade agreement should ensure strengthening of North American steel and manufacturing supply chains.
The government must go ahead with implementation of law that brings in substantial reforms to the existing tax codes. A notable reduction in corporate tax rates would foster manufacturing activities by means of fresh capital investment and thereby increase the competitiveness of domestic steel producers. The Institute demanded that corporate tax rate must be reduced to 15-20%. The legislation should continue to permit the use of LIFO method of accounting. AISI also called for elimination of the corporate alternative minimum tax and implementation of appropriate transition rules to switch over to new taxation system. Further, no new limitations must be placed on carry forward and carry back of net operating losses.
The availability of energy at subsidized rate is a necessary requirement for domestic steel industry to remain competitive with international competitors. Incidentally, US domestic steel industry has made significant reductions in energy usage over the past several years. The sector has achieved 32% reduction in energy intensity since 1990. The greenhouse gas emissions intensity too has declined by over 37% during this period. AISI Public Policy Agenda urges the US administration to revise the Clean Power Plan and other rules to ensure that they do not undermine the competitiveness of US manufacturers. In addition, the administration must take necessary actions to boost investment in national energy infrastructure with special impetus on completion of Keystone XL and Dakota Access pipelines.
According to AISI, the creation of multiple environmental regulatory policies at federal and state levels has resulted in competitive disadvantage for steel industry. The administration and Congress should act to reconsider recent EPA regulatory actions. EPA should add iron ore mining to the list of 59 categories of mining activities excluded from financial assurance. Also, the implementation of the new Ozone National Ambient Air Quality Standards must be deferred for at least two years. Further, EPA should develop steel sector air pollution rules within a stipulated timeframe.
The Public Policy Agenda for 2017 also urges the administration and Congress to provide increased funding for development of adequate transportation infrastructure facilities such as bridges, roads, waterways and railroads. AISI noted that recent OSHA regulations on workplace safety may result in unnecessary costs for employers and demanded reconsideration of those reforms.