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Some Steel Sector Indicators

Summary:
Which should give you pause for thought about national-security-rationalized tariffs. Output stable, real prices up. Figure 1: Raw steel production, 2012=100, Seasonally Adjusted (blue, left log scale), and Producer Price Index for Cold Rolled Steel Sheet and Strip, Jun 1982=100, Monthly, Not Seasonally Adjusted deflated by CPI less food and energy, seasonally adjusted (red, right log scale). NBER defined recession dates shaded gray. Source: Federal Reserve Board and BLS via FRED, NBER, and author’s calculations. The recovery has been driven in part by already implemented trade measures (anti-dumping, safeguard), so not asserting that we shouldn’t try to mitigate the effects of excess steel capacity abroad. Rather, it’s not clear that Section 232 is the way to go. From Palette and Dawsey

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which should give you pause for thought about national-security-rationalized tariffs. Output stable, real prices up.

Some Steel Sector Indicators
Figure 1: Raw steel production, 2012=100, Seasonally Adjusted (blue, left log scale), and Producer Price Index for Cold Rolled Steel Sheet and Strip, Jun 1982=100, Monthly, Not Seasonally Adjusted deflated by CPI less food and energy, seasonally adjusted (red, right log scale). NBER defined recession dates shaded gray. Source: Federal Reserve Board and BLS via FRED, NBER, and author’s calculations.

The recovery has been driven in part by already implemented trade measures (anti-dumping, safeguard), so not asserting that we shouldn’t try to mitigate the effects of excess steel capacity abroad. Rather, it’s not clear that Section 232 is the way to go.

From Palette and Dawsey in WaPo:

Defense Secretary Jim Mattis and Secretary of State Rex Tillerson privately warned senior trade officials on Tuesday that President Trump’s proposed tariffs on steel and aluminum could endanger the U.S. national security relationship with allies, according to five people familiar with the meeting.

Menzie Chinn
He is Professor of Public Affairs and Economics at the University of Wisconsin, Madison

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