U.S. GOVERNMENT PUBLISHING OFFICE

35–941—PDF WASHINGTON : 2019

S. HRG. 115–576 

TRADE ENFORCEMENT AND INFRASTRUCTURE: 

SAFEGUARDING OUR INDUSTRIAL BASE FROM 

PRESENT AND FUTURE CHALLENGES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON INTERNATIONAL TRADE, 

CUSTOMS, AND GLOBAL COMPETITIVENESS 

OF THE

COMMITTEE ON FINANCE 

UNITED STATES SENATE 

ONE HUNDRED FIFTEENTH CONGRESS 

SECOND SESSION 

(MONACA, PA) 

FEBRUARY 16, 2018 

( 

Printed for the use of the Committee on Finance 

COMMITTEE ON FINANCE 

ORRIN G. HATCH, Utah, Chairman 

CHUCK GRASSLEY, Iowa 

MIKE CRAPO, Idaho 

PAT ROBERTS, Kansas 

MICHAEL B. ENZI, Wyoming 

JOHN CORNYN, Texas 

JOHN THUNE, South Dakota 

RICHARD BURR, North Carolina 

JOHNNY ISAKSON, Georgia 

ROB PORTMAN, Ohio 

PATRICK J. TOOMEY, Pennsylvania 

DEAN HELLER, Nevada 

TIM SCOTT, South Carolina 

BILL CASSIDY, Louisiana 

RON WYDEN, Oregon 

DEBBIE STABENOW, Michigan 

MARIA CANTWELL, Washington 

BILL NELSON, Florida 

ROBERT MENENDEZ, New Jersey 

THOMAS R. CARPER, Delaware 

BENJAMIN L. CARDIN, Maryland 

SHERROD BROWN, Ohio 

MICHAEL F. BENNET, Colorado 

ROBERT P. CASEY, JR., Pennsylvania 

MARK R. WARNER, Virginia 

CLAIRE MCCASKILL, Missouri 

SHELDON WHITEHOUSE, Rhode Island 

A. JAY KHOSLA, Staff Director 

JOSHUA SHEINKMAN, Democratic Staff Director 

SUBCOMMITTEE ON INTERNATIONAL TRADE, 

CUSTOMS, AND GLOBAL COMPETITIVENESS

JOHN CORNYN, Texas, Chairman 

CHUCK GRASSLEY, Iowa 

PAT ROBERTS, Kansas 

JOHNNY ISAKSON, Georgia 

JOHN THUNE, South Dakota 

DEAN HELLER, Nevada 

ROBERT P. CASEY, JR., Pennsylvania 

DEBBIE STABENOW, Michigan 

BILL NELSON, Florida 

CLAIRE MCCASKILL, Missouri 

BENJAMIN L. CARDIN, Maryland 

(II) 

C O N T E N T S 

OPENING STATEMENTS 

Page 

Casey, Hon. Robert P., Jr., a U.S. Senator from Pennsylvania ........................... 1 

Wyden, Hon. Ron, a U.S. Senator from Oregon .................................................... 4 

WITNESSES 

Paul, Scott N., president, Alliance for American Manufacturing, Washington, 

DC .......................................................................................................................... 6 

Galiano, Rick, president, Beaver Lawrence County Central Labor Council, 

New Castle, PA .................................................................................................... 9 

Mitchell, Petra B., president and CEO, Catalyst Connection, Pittsburgh, PA ... 11 

Young, Todd, managing director, government affairs, United States Steel 

Corporation, Pittsburgh, PA ................................................................................ 12 

ALPHABETICAL LISTING AND APPENDIX MATERIAL 

Casey, Hon. Robert P., Jr.: 

Opening statement ........................................................................................... 1 

Prepared statement .......................................................................................... 25 

Galiano, Rick: 

Testimony .......................................................................................................... 9 

Prepared statement .......................................................................................... 26 

Mitchell, Petra B.: 

Testimony .......................................................................................................... 11 

Prepared statement .......................................................................................... 28 

Paul, Scott N.: 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 31 

Wyden, Hon. Ron: 

Opening statement ........................................................................................... 4 

Young, Todd: 

Testimony .......................................................................................................... 12 

Prepared statement .......................................................................................... 37 

(III) 

(1) 

TRADE ENFORCEMENT AND 

INFRASTRUCTURE: SAFEGUARDING 

OUR INDUSTRIAL BASE FROM PRESENT 

AND FUTURE CHALLENGES 

FRIDAY, FEBRUARY 16, 2018 

U.S. SENATE,

SUBCOMMITTEE ON INTERNATIONAL TRADE,

CUSTOMS, AND GLOBAL COMPETITIVENESS, 

COMMITTEE ON FINANCE, 

Monaca, PA. 

The subcommittee was convened, pursuant to notice, at 9:53 

a.m., at the Learning Resource Center, Conference Room 103, Community College of Beaver County, Monaca, PA, Hon. Robert P. 

Casey, Jr. presiding. 

Present: Senator Wyden. 

Also present: Senator Casey’s staff from Pittsburgh: Elizabeth 

Fishback, Regional Director; Jim Ferruchie, Regional Representative; Jordan Ball, Regional Representative; Jacklin Rhoads, Press 

Secretary; and Nico Starr, Special Assistant to the Senator. Senator Casey’s staff from DC: Livia Shmavomian, Legislative Assistant; and Andrew Usyk, Legislative Assistant. Finance Committee 

staff: Jayme White, Chief Advisor for International Competitiveness and Innovation; Elissa Alben, Senior Trade and Competitiveness Counsel; Jewel Harper, Senior Deputy Clerk; and Susanna 

Segal, Deputy Clerk. 

OPENING STATEMENT OF HON. ROBERT P. CASEY, JR., 

A U.S. SENATOR FROM PENNSYLVANIA 

Senator CASEY. This hearing will come to order. This is the Subcommittee on International Trade, Customs, and Global Competitiveness of the United States Senate Committee on Finance. We 

are grateful that everyone is here. We are sorry that we are a few 

minutes late. 

I am privileged to be joined by Senator Wyden from Oregon. He 

is the top Democrat, what they call in Washington the ranking 

member, of the Committee on Finance. 

And we are late for a good reason. We just had a phone call that 

both of us will talk a little bit about. 

But I want to make sure that we first and foremost thank the 

Community College of Beaver County. Dr. Reber, we are grateful 

you are with us today, and grateful to have the benefit of the report that you gave me about the work, the tremendous work, being 

2 

done here on a whole range of workforce issues and preparing for 

the future of Beaver County and southwestern Pennsylvania. 

We don’t have time to get too far into that today, but I think a 

lot of what we are talking about today on trade and especially infrastructure has relevance to those discussions about our workforce. 

So, Doctor, thank you for having us here. We are grateful. 

I want to thank our witnesses, whom I will be introducing in a 

moment before we get into their testimony. 

We are here today to discuss what I view and what I think most 

Americans view as two of the most critical issues that relate to the 

competitiveness of our Nation—manufacturing and infrastructure—which have, of course, a substantial impact on jobs and 

wages. 

I am honored to be joined by Senator Wyden, who came from 

Washington to be with us, but, as you know, he represents the 

State of Oregon and has worked for years on all these issues: trade 

issues, economics and jobs issues, manufacturing, infrastructure, 

and the like. 

We know that steel overcapacity, as well as trade cheating and 

China’s efforts to literally steal our future by stealing our companies, are some of the most fundamental trade challenges of our 

time because they directly impact Pennsylvania jobs and wages. I 

have said for years and I will say it again: when China cheats, 

Pennsylvania loses jobs. It is that simple. So we have to face that 

reality when we are confronting these issues. 

China is going after America’s competitive advantage by any 

means necessary. If China can’t buy it or if China can’t run it out 

of business, they usually steal it. Unfortunately, that is a harsh reality. 

So you don’t need to look far in our State to find companies and 

unions that have been hacked by the Chinese Government. Just 

talk to U.S. Steel, talk to Steelworkers, talk to other institutions 

in southwestern Pennsylvania that have been victims of these actions. 

I went to the White House this past Tuesday to meet with the 

President in a bipartisan, bicameral group—both Houses of Congress, Senators and House members of both parties, including Senator Wyden, who was with us at that meeting—to discuss steel and 

aluminum principally, but to talk more generally about a number 

of these issues. At that meeting, I told the President how Pennsylvania companies have been hammered, and I use that verb purposefully, hammered by a surge in imports since the Commerce Department announced its section 232 investigation last April, which 

was focused on rising steel and aluminum imports and how they 

represent a threat to our national security. 

I also heard from Senators telling the President to exercise caution. That is what a number of Republican Senators and House 

members were telling him. I have a different view, which we will 

get into later. 

When the Commerce Department launched this investigation in 

April of last year, I along with steelworkers across Pennsylvania 

were hopeful that the Commerce Department would quickly complete their study and the President would take decisive action. And 

3 

then we waited, and we waited, and we waited. Through the spring 

and the summer, rumors were swirling, but still, steel imports 

were surging. 

The Commerce Department seemed ready to transmit the report 

by the end of the summer, and then the President told The Wall 

Street Journal in July that he did not intend to move forward on 

a final determination on the steel section 232 case until ‘‘everything finished up between health care and taxes and maybe even 

infrastructure.’’ So said the President at that time. 

Meanwhile, we watched imports rise for the first 11 months of 

2017. Total steel and finished steel imports were up 17.5 percent 

and 14.6 percent, respectively, from the same period in 2016. So 

total steel basically up 18 percent, imports up, and finished steel 

imports up basically 15 percent in that time period. 

Imports of electrical steel, which many of you know is the steel 

used to ensure that we have an electricity grid—which is another 

infrastructure issue that we are going to be dealing with—imports 

of that kind of steel, electrical steel, have more than doubled from 

2016 to 2017. 

Pipe and tube surged 82 percent from 2016 to 2017. So electrical 

steel up 100 percent, and pipe and tube up 82 percent. 

The Commerce Department had 270 days to transmit the report 

to the President. They submitted it just shy of that by a few days. 

The President now has 90 days—actually, now it is 60, because it 

was almost a month ago, so, basically, 60 days to make a determination. 

Now, when you have these meetings, you do not have 25 minutes 

to make your point. You have to make it in about 2 minutes. So 

my point was to raise the issue with the President on 232, because 

the discussion started to meander off into other issues, and I wanted to keep it focused on these issues. I made two basic points to 

the President. One was that number on electrical steel, to remind 

him about that, and two, to ask him to make a determination not 

using the whole 90 days. I wanted him to bring a sense of urgency 

to this issue right now. And he listened, listened to our pleas, and 

I hope will make a decision. 

So why were we a few minutes late? Well, Senator Wyden just 

got a call from Commerce Secretary Wilbur Ross. They obviously 

talk on a regular basis, but I thought it was particularly opportune 

that this hearing was supposed to start at 9:45, and, all of a sudden, we got a call at 9:40 from the Commerce Secretary about this 

issue. Senator Wyden can tell us more. But apparently, there is 

going to be a press conference or a press call at 10:30, which is 

good news. That means that, somehow, between the meeting the 

other day and today’s hearing, we have gotten some people’s attention. I will leave it at that for now. 

Let me go back to China and then wrap up. 

I said earlier we cannot allow China to steal our future. That is 

not drama and hyperbole. That is the truth. If we allow them to 

continue on the pathway they have been on, they will steal our future. Actions matter, and the actions we take today must be directed at long-term outcomes we want for our children and our 

grandchildren. This means an economy that creates opportunities 

4 

for all Americans and a system that creates a fair environment for 

our workers to find jobs that pay family-sustaining wages. 

This also means investing in our roads and bridges, schools, locks 

and dams, which are so important to commerce here in southwestern Pennsylvania, and, of course, our electricity grid. And I did 

not mention broadband, and we could go down a longer list. You 

get it. Infrastructure matters. It is about our security. It is about 

our safety. And it is about our jobs. 

So this means putting real Federal dollars behind infrastructure 

that is fundamental to our combined competitiveness. I am never 

opposed to public-private partnerships or other ideas to finance infrastructure, but we have to have significant Federal dollars. I believe you can do infrastructure one of two ways. You can do it the 

corporate way, which is not the way to do it, or you can do it the 

American way. 

I want an American infrastructure bill. It means we are all in 

this together. We are all one American family. We ought to put 

public dollars in, and big dollars, to really make a difference and 

create jobs. So this means making sure that the inputs to that infrastructure are made in America. 

I think both parties agree on that, and I am grateful that Senator Wyden is here today to make these points and to discuss these 

critical matters for the economy of Pennsylvania and jobs in Pennsylvania, as well as American jobs and American competitiveness. 

So I am happy to turn the microphone over to Senator Ron 

Wyden, the ranking member of the Committee on Finance. And I 

hope—this is just my hope; I am not allowed to say more than 

this—I hope a year from now, he will be the chairman of the most 

important committee in the United States Senate when it comes to 

our economy. 

[The prepared statement of Senator Casey appears in the appendix.] 

Senator CASEY. Senator Wyden? 

OPENING STATEMENT OF HON. RON WYDEN, 

A U.S. SENATOR FROM OREGON 

Senator WYDEN. Thank you, Senator Casey. I do not want to 

make this a bouquet-tossing contest, but I want to note that Senator Casey’s hearing could not be more timely. Sometimes in the 

Congress you hear about a hearing on such and such subject, and 

everybody says, well, we will come back in a couple years and see 

if anything is going on. With respect to Senator Casey’s hearing, 

we just heard from Secretary Ross indicating that here in maybe 

20 minutes or so the country is finally going to be told what are 

going to be the options to protect American jobs, protect American 

industries. And particularly in our case—and I heard Senator 

Casey talk about this at the White House—is the need to try to 

make sure that we actually use all the tools to keep foreign companies from making an end-run around our trade laws. 

And what we have done over the years—and Senator Casey and 

I have been a team, with several colleagues—is we have put in 

place a variety of new tools to deal with how these countries rip 

us off with, for example, dumping practices and subsidy practices 

and the like. 

5 

But as Senator Casey noted at the White House, these tools 

haven’t always been used. And to sum it up, what we want is trade 

done right, and that means using all the tools and using them in 

a timely way. 

Now, as Senator Casey mentioned, if you look at this past year, 

what you have to say is, by some measures, steelworkers are actually worse off than they were a year ago, because there was a lot 

of tough talk early on that led to a surge in steel imports, and so 

a lot of struggling steel communities were wondering what was 

next. 

I think what we learned in this call this morning from the Secretary, from Secretary Ross, is, as a result of this kind of effort, 

and with Senators like Bob Casey weighing in as they have, this 

administration is finally realizing they had better act sooner rather 

than later. That is how I would sum it up. 

And here in 20 minutes, we will get an inkling of what the major 

recommendations are with respect to both steel and aluminum. Of 

course, the President has legal authority to set all of them aside. 

He does not have to do any of them. But we will finally get this 

long-overdue report that we wanted, in some sense. A number of 

us said at the White House that, to make thoughtful recommendations about matters like the 232 law, you have to have the report. 

We have been pulling and prying and pushing to get it out, and 

now, finally, it is getting out. 

One last point, and then, like Senator Casey, I want to hear from 

all of you. 

When I talk about using all the tools in the toolbox, you cannot 

afford, in a time like this, to pass up opportunities. I will close with 

a point with respect to infrastructure. We all understand that for 

big-league economic growth, you cannot have little-league infrastructure. So when the infrastructure plan came out this week, I 

just kind of rushed through it to see what was going to be in it to 

talk about using more American steel and more American goods 

and services. There is essentially nothing there, no mention of Buy 

America, vital to American steel. 

By the way, the plan actually gives the States the ability to walk 

back current law with respect to using American steel and American products. 

So Senator Casey and I feel really strongly that in this battle to 

deal with global competition, we feel we can beat the pants off everybody as long as our government uses the tools that it has at its 

disposal. 

So we are anxious to hear from all of you. One of the few benefits 

of seniority is you can give all the difficult questions to Senator 

Casey and anything easy to me. 

It is nice to be here. Thank you for inviting me, Senator Casey. 

Senator CASEY. Senator Wyden, thanks very much. We are grateful you are here. We have lots to talk about. 

Let me introduce our witnesses, who have been in their seats for 

a good while. So I will do a brief introduction, but I don’t want to 

skip over it. Many of you know these witnesses already, either personally or by way of their work. 

Scott Paul is president of the Alliance for American Manufacturing, which is a partnership established in 2007—I can’t believe 

6 

it is that long now—by some of America’s leading manufacturers 

and the United Steelworkers Union. Scott currently serves as the 

board chair of the National Skills Coalition and is on the board of 

visitors of the Political Science Department at Penn State, his alma 

mater. Scott also has an M.A. in security studies from Georgetown 

University School of Foreign Service. 

Scott, welcome. 

I will do all our introductions, and then we will go to the testimony after that. 

Petra Mitchell, in the third chair, obviously, is president and 

CEO of Catalyst Connection, a private, nonprofit economic development organization dedicated to helping manufacturers grow their 

businesses and create new jobs. She currently serves on the board 

of directors of the Advanced Robotics and Manufacturing Institute, 

Leadership Pittsburgh, and Pennsylvania Industrial Resource Center Network, the so-called IRC Network. Petra received numerous 

honors for her leadership, including being named one of the 2016 

most-admired CEOs in Pittsburgh by the Pittsburgh Business 

Times. 

I have known Petra for years. Petra, thank you for being here 

with us. 

Rick Galiano is the president of the Beaver Lawrence County 

Central Labor Council and a representative for the United Steelworkers. Before his career in the Steelworkers Union, Rick worked 

at the TMK IPSCO Koppel steel facility. He is a graduate of Lawrence County Vo-Tech School in New Castle in Lawrence County. 

Rick sits on the Lawrence County United Way board and is a 

member of the Lawrence County Drug and Alcohol Commission. He 

lives with his wife of 40 years, Maryann, in New Castle. 

Rick, thank you for being with us, and thanks for all that work 

you do on a lot of issues. 

Todd Young serves as the managing director of government affairs for the United States Steel Corporation, reporting to the 

president and chief executive officer, David Burritt. Todd manages 

U.S. Steel’s Federal, State, and local government affairs. 

Todd, thank you. 

Scott, why don’t we start with you? And we will try, if you can, 

to keep it to 5 minutes, because we want to get to as many questions as possible. 

STATEMENT OF SCOTT N. PAUL, PRESIDENT, ALLIANCE FOR 

AMERICAN MANUFACTURING, WASHINGTON, DC 

Mr. PAUL. Certainly, Senator Casey. Thank you so much for 

hosting this hearing in western Pennsylvania, which, in many 

ways, was America’s foundry for so many generations. And, Senator Wyden, thank you for venturing here as well. I want to commend both of you for your leadership, your work on manufacturing, 

trade, and infrastructure issues. 

I especially want to commend the role that you played just earlier this week at the White House. I thought that the feedback that 

you delivered to the President obviously was heard. I know that 

Senator Wyden said, ‘‘Let’s see these reports,’’ and, 3 days later, we 

had them. 

7 

And, Senator Casey, you mentioned, as you said in your opening 

statement, what the consequences of this delay have been, which 

are very real. In addition to the imports that we have seen increase, it is stunning that at a time when you have seen modestly 

positive economic growth, overall the steel industry is struggling. 

That does not make any sense. And you can only draw a correlation to the rise in imports, which you can clearly attribute to companies and countries trying to game the system and get in before 

any relief is provided. 

So I will be eagerly awaiting the recommendations of those reports as well. But I want to commend both of you on your leadership. And I hate to refer people to Twitter a lot, but I thought, Senator Casey, you had some especially poignant thoughts after the 

meeting at the White House about what the impact of this has 

been for Pennsylvania that are worth pointing out to the audience. 

I want to say that trade has traditionally been a very bipartisan 

issue that impacts red States, blue States, every State. And in that 

vein, I was excited to serve on the President’s manufacturing jobs 

initiative. I had hoped, at the beginning of it, that there would be 

a robust role on it for trade. That did not occur. Instead, we were 

not able to accomplish much of anything. 

I was also—as I think a number of us from industrial States 

were—hopeful based on some of the President’s rhetoric with respect to trade enforcement and very specific commitments that he 

made, that we would see a substantial amount of progress. The 

way I would characterize it to this point is, we have seen a lot of 

trains that have left the station, but none of them has arrived, and 

a couple of them have been derailed. We need to get them on track 

for America, and for American workers in particular. 

I have a lot of content in my written remarks, and I won’t bother 

repeating that, but I just wanted to focus on a couple principles in 

the time that I have. I think you both recognize that, for too long, 

trade enforcement has been viewed as an appendage of our trade 

policy rather than a core of it, and that has had extraordinary consequences. 

We have seen a rising trade deficit with China that reached a 

record $375 billion in goods last year. You have seen countries that 

feel like they have a blank check to dump, to subsidize, to engage 

in market-distorting practices, intellectual property theft. And 

while you have seen enforcement in past administrations, it is hard 

to make the argument that it was central to their trade strategy. 

Oftentimes, it was designed to deliver votes on something else or, 

in the case of Reagan, Congress wanted to take much stronger action than he did. George Bush saw a political opportunity in West 

Virginia by offering some relief for steel. But you haven’t seen it 

at the core of an administration’s trade policy. 

I think you understand that, and that is something that we encourage this administration to pursue as well. And I am going to 

return to that in a second, because there certainly has been a real 

disconnect and a real division in our country on economic lines, on 

what is happening with respect to manufacturing, on the outlook 

for trade, that I think has been colored by this fact that trade enforcement has not been a central part of America’s economic philosophy for a very long time. 

8 

Second, I want to expand on this idea that the President’s promises and the lack of follow-through so far have had some real consequences, because I think they have. 

You pointed out, Senator Casey, the 232 announcements, the 

rhetoric, and then the lack of follow-through that has occurred so 

far. And you have seen in Conshohocken some layoffs announced, 

in Steelton at Dura-Bond. We have seen a steel mill in Kentucky 

that has closed down. You have seen challenges in the aluminum 

industry as well. 

To add to your data on surging imports, in oil country, tubular 

goods, which are a specific high-margin product for the steel industry, one that is very essential to the energy infrastructure, you 

have seen a 200-percent increase in imports just from 2016 to 2017. 

Just yesterday, at a major energy project in Texas, the Gulf 

Coast Express Pipeline Project, the funders of that project announced that more than half of the pipe would be coming from Turkey as opposed to American producers. And we know that Turkish 

steel is often dumped and subsidized. So this raises, to me, real 

questions about another commitment that the President made, and 

that was that we would have American-made pipelines. 

There was a memorandum signed with great fanfare a year ago 

at the White House, and there has been no palpable follow-through 

that I have seen with respect to that. 

I also want to say that I commend the role that both of you have 

played in trade enforcement and the improvements that we have 

seen in the law in the last couple years. They have had real, tangible, and helpful impacts that I am happy to expand upon in Q&A, 

if we should arrive at that, but they have made a real difference 

for American industry and for American workers. 

I will say a word about infrastructure, and then I will close with 

a thought back on trade expansion. 

So all of the trade actions in the world will not make a difference 

if we do not have a robust public investment to increase demand 

in this country. We have fallen behind. It obviously has an impact 

for commuters. It has serious impacts for manufacturing with respect to logistics, competitiveness when it comes to global trade, 

and for attracting both talent and moving materials and people 

back and forth. 

And by infrastructure, I speak very broadly, I think like you do, 

that we need everything from our broadband, our energy grid, to 

our bridges, our roads—we need a serious upgrade. 

I share your belief that this has to be public investment. We are 

not opposed to public-private partnerships. We also see the strong 

benefits of ensuring that it is made with American-made iron and 

steel. That is how we built the most magnificent achievements in 

our country, and there is really no reason to think that we cannot 

do it now other than some vague, philosophical objections and 

maybe perhaps some envy that other nations may have. 

I want to end on a very wonky note, but one that I think resonates today, and that goes back to the underlying legislation of section 232, which no one I think had focused on a lot before the 

President said he was going to take this action. It was part of the 

Trade Expansion Act of 1962, which was perhaps the biggest legislative achievement of that Congress, pushed by President Kennedy. 

9 

It is notable that, at the signing ceremony of the act, George 

Meany, the president of the AFL–CIO, was there supporting a bill 

that dramatically cut tariffs on products, gave the President broad 

authority to do that. But embedded in that legislation were a number of trade enforcement tools, including section 232. 

The fact that over the years you have seen that trade expansion 

and tariff authority take off and you have seen free-trade agreements, where you have seen the real sporadic enforcement of trade 

laws like through section 232, speaks to kind of the situation we 

are in where our politics have become more radicalized, our communities have become less hopeful. In a way, there is an eroded 

sense of trust in the government’s ability to respond to problems. 

And part of it is precisely because we have not exercised these 

trade enforcement tools. 

I think that needs to be a central part of our trade agenda as 

we move forward. 

I want to commend the role that, Senator Wyden, you have 

played in the past, and Senator Casey as well, both with the ENFORCE Act and the Leveling the Playing Field Act. I look forward 

to working with you in the future on that. 

Thanks so much. 

[The prepared statement of Mr. Paul appears in the appendix.] 

Senator CASEY. Scott, thanks so much for your testimony and for 

that perspective from history as well. 

Rick Galiano. 

STATEMENT OF RICK GALIANO, PRESIDENT, BEAVER LAWRENCE COUNTY CENTRAL LABOR COUNCIL, NEW CASTLE, 

PA 

Mr. GALIANO. Good morning. Mr. Chairman, members of the caucus, it is an honor for me to speak at this field hearing on the trade 

enforcement infrastructure. 

My testimony to you is straightforward. I try to do everything in 

my power to improve the livelihood of our union brothers and sisters, our communities, and our country. I would like Congress and 

the administration to also do the same. 

My concern is that the tools our country has to defend its manufacturing base and move it further into the new era need to be improved, but much more must be done. Since Congress passed the 

Leveling the Playing Field Act and the ENFORCE Act, a slew of 

trade enforcement cases followed. 

Our union sees the day-to-day results when a worker gets a job 

back and their hours are increased. I also see the potential. We 

have to do more. Restoring fair play and ensuring that we have a 

fair chance to compete internationally is all we ask. 

For example, since USW successfully brought forward trade 

cases on the passenger vehicle and light truck tires from China and 

off-road tires from India, close to $3 billion have been invested in 

U.S. tire plant expansions and factories. Seven thousand, two hundred union workers at Goodyear reached a 5-year agreement with 

wage improvements and extension of plant protection guarantees 

where no USW plants will close during the term of the agreement. 

10 

To the doubters of the value of trade enforcement, I dare them 

to look at those workers in the face and tell them they are not 

worth protecting. 

I wish I could say there is a similarly positive outcome in the 

steel industry as in the tire industry. Since the passage of the Leveling the Playing Field Act, 67 new tariffs against multiple countries have been put in effect on steel. 

While these trade enforcement acts have slowed the tide of the 

illegal imports, too many of the 19,000 steelworkers who have been 

laid off since 2015 are still waiting for idled and underutilized facilities across the country to restart. 

And let’s remember, trade cases are simply about addressing unfair foreign trade as agreed upon in international rules. We were 

not asking for anything that the law was not designed to provide. 

USW has been cautiously optimistic about the chance for unilateral 

relief through implementation of section 232 steel and aluminum 

investigations currently in President Trump’s hands. 

When President Trump and administration officials pledged to 

unveil the findings of the section 232 investigations by July 1st of 

2017, we were hopeful at first and left wondering the day after. 

The USW firmly believes that our Nation’s military and critical infrastructure needs are essential to our national security. 

By delaying the 232, the foreign steel industry saw an opening. 

While the U.S. has shipped more steel this year, the finished steel 

import market share was 27 percent for the full year of 2017. Total 

and finished steel imports are up 15.4 percent and 12.2 percent, respectively. 

The economy has grown, but the U.S. steel industry continues to 

fight because of foreign steel products. Most of the growth in our 

market is going to imports, not to our steel mills and our steelworkers. 

Our trade laws need to reflect a more globally connected world 

and the potential for abuse of bad actors. Modern steelworkers in 

this country can make 1.9 tons of steel per man-hour. I want our 

country’s trade laws to be more efficient and effective. 

You asked me to speak on infrastructure, and no amount of trade 

enforcement will matter if we cannot get our goods from coast-tocoast. The Finance Committee has the potential not to just upgrade 

our trade laws but also seek the path to renew our Nation’s infrastructure. 

It is simple. If I paid half my mortgage payments, I would lose 

my home. Yet this country is paying only half of America’s infrastructure bill, leaving an investment gap and commuters stuck in 

gridlocked traffic. 

Please think about this. Eighty-eight million citizens in urban 

and rural America lack affordable broadband access. One out of 5 

miles of highway pavement is in poor condition. 

I do not know all the solutions to these problems, but just like 

every USW member, I am willing to roll up my sleeves and fix 

these problems. We need to ensure that our tax dollars are used 

to maximize the economic benefit and domestic policies, like Buy 

America. 

11 

In closing, I know that with a strong trade enforcement strategy 

combined with a concerted effort to renew our infrastructure, we 

can create a better America. 

Thank you for your time. 

[The prepared statement of Mr. Galiano appears in the appendix.] 

Senator CASEY. Rick, thanks very much. I was noting that one 

number you had there on, I guess it was page 4. A modern steelworker can make 1.9 tons of steel per man-hour. That is a good 

number to remember. 

Petra Mitchell. 

STATEMENT OF PETRA B. MITCHELL, PRESIDENT AND CEO, 

CATALYST CONNECTION, PITTSBURGH, PA 

Ms. MITCHELL. Good morning. Senator Casey, Senator Wyden, 

welcome to southwestern Pennsylvania, and thank you for having 

me here today. 

This morning, I would like to address our Nation’s supply chain, 

which is made up of small and medium-sized manufacturers that 

serve many sectors including our infrastructure, metals, advanced 

materials, DOD, and our national security sectors. 

At Catalyst Connection, we are dedicated to serving these companies. We provide technical assistance, management consulting, and 

workforce development, such that, when individual companies grow 

and succeed, collectively they impact the region’s economy and our 

Nation’s supply chains. 

To enable us to do our work, we are funded, in part, by the Manufacturing Extension Partnership, or MEP program, and the Industrial Resource Center program here in Pennsylvania, which was 

started by Governor Robert Casey, Senator Casey’s father, and was 

a model for the national program. So I feel this was very, very insightful on Governor Casey’s part to start this program. 

I would like to provide you with a brief overview of the MEP program and then some of the challenges that our small and mediumsized manufacturers are facing, and the role that the MEP program 

and Catalyst Connection are playing in helping to address those 

challenges. 

And, Senator Wyden, I liked your term of using the tools in the 

toolbox. I would like to suggest that MEP is a critical tool in that 

toolbox. 

The MEP program is the only Federal program dedicated to serving our country’s small manufacturers. These companies make up 

99 percent of all manufacturing establishments. Last year, we 

served 26,000 companies across the United States. Many of these 

firms are often overlooked by larger for-profit firms because the 

cost of sales can be high, and the typical project size is low. The 

impact of the work, however, is very high. 

The MEP program delivers $8.70 for every dollar of Federal 

funding invested. This is according to the Upjohn Institute. MEP 

clients themselves reported over $12 billion of new and retained 

sales and the creation or retention of over 100,000 jobs just in the 

last year. Considering that the average manufacturing worker 

earns over $80,000, MEP centers are economic drivers in their communities. 

12 

Fortunately, the MEP program has been reauthorized by Congress through the American Innovation and Competitiveness Act. 

Unfortunately, the President’s budget once again eliminates the 

program. 

Catalyst Connection clients have contributed to the national program results just mentioned. Companies that work with us are hiring, growing, and adding jobs, but we need to do more. Sadly, manufacturing employment in our region has decreased by almost 5 

percent in the last 5 years even though output and productivity are 

growing. We believe that a majority of the job losses are from larger firms or plant closures at some larger firms. But the growth in 

jobs among small and medium-sized manufacturers is just not 

enough to make up for those losses. 

To reverse these trends, companies must accelerate their pace of 

growth greater than any productivity gains they need to remain 

competitive in a global economy. They have to invest in new products, automation and robotics, and in their people. And this is a big 

challenge. 

While many companies are growing and interested in hiring, the 

skills gap in manufacturing is another significant challenge. According to a Deloitte report, the skills gap may result in 2 million 

manufacturing jobs going unfilled. 

Manufacturing CEOs are looking for help, and the MEP program 

can provide it. Our services and operational improvements, business growth and innovation, exporting, and training create the 

foundation for the adoption of new and advanced manufacturing 

technologies, and for upscaling of workers. 

So I would urge you to continue your support for policies that 

favor small businesses and for the MEP program, to continue to 

support small and medium-sized manufacturers that provide highpaying, family-sustaining jobs. 

And I would just like to share that I am personally the beneficiary of one of those jobs where my father worked in manufacturing and, even as an immigrant, was able to provide me with a 

very comfortable childhood and a college education. I would like to 

see many more of our friends and neighbors have similar experiences. And I feel that, with your support, that is definitely achievable. 

Thank you. 

[The prepared statement of Ms. Mitchell appears in the appendix.] 

Senator CASEY. Petra, thanks very much. 

Todd Young. 

STATEMENT OF TODD YOUNG, MANAGING DIRECTOR, GOVERNMENT AFFAIRS, UNITED STATES STEEL CORPORATION, 

PITTSBURGH, PA 

Mr. YOUNG. Thank you, Senator, for conducting today’s hearing 

in western Pennsylvania and for inviting testimony from the 

United States Steel Corporation, which is proudly headquartered 

here in Pittsburgh. Senator Casey, your leadership in convening 

the hearing is very much appreciated, because both trade law enforcement and improving America’s infrastructure are public policy 

priorities for America’s steelmakers. 

13 

U.S. Steel was founded in 1901. It is the largest integrated steel 

producer headquartered in the U.S. with domestic annual raw 

steelmaking capability of 17 million net tons. Our major domestic 

steel operations are located in Indiana, Michigan, Illinois, and right 

here in Pennsylvania at our Mon Valley Works. Our tubular operations are located in Alabama, Ohio, Arkansas, and Texas. And our 

two Minnesota mining operations supply iron ore pellets to all of 

our steel-making operations. 

U.S. Steel Corporation manufactures semi-finished steel as well 

as a wide range of value-added flat role and tubular products for 

the automotive, appliance, container, industrial machinery, construction, and oil and gas industries. When it comes to trade enforcement, over the past several years, America’s steel companies 

and workers have been challenged by significant, persistent, unfairly traded imports flooding our markets from overseas. Steel at 

dumped prices and subsidized by foreign governments targets 

America’s open markets. 

As a result, many American steelmaking facilities, including 

those of U.S. Steel, have been forced to shut down temporarily or 

even permanently, causing thousands of job losses. 

American steel companies can compete and win against anyone 

on a level playing field, yet that requires fair enforcement of our 

trade laws and strong, prompt action by the Federal Government. 

We commend Congress on passing the 2015 Leveling the Playing 

Field Act, which significantly strengthened U.S. trade remedy law 

by clarifying the injury standard for the International Trade Commission and antidumping and countervailing duty, or AD/CVD 

cases, and providing the Commerce Department with the additional tools to address dumped and subsidized imports. This was 

the result of forceful bipartisan leadership by steel champions in 

both the House and the Senate. 

Just months later, the Enforce and Protect Act was passed. This 

law provided U.S. Customs with new tools and directives to aggressively enforce U.S. trade remedy orders and crack down on duty 

evasion and Customs fraud. It was critical that this second law followed as AD/CVD orders only level the playing field if they are 

strictly and effectively enforced. 

Senator Casey and Senator Wyden, thank you for your roles in 

enacting these stronger trade rules. 

U.S. Steel and other domestic producers moved swiftly in the 

summer of 2015 to utilize these new laws by filing a series of new 

AD/CVD petitions on a flood of unfairly traded imports of hotrolled, cold-rolled, and corrosion-resistant steel from 12 countries. 

As a result of these cases and due to the new laws, 28 new AD/ 

CVD orders were obtained on 11 countries, providing U.S. Steel 

Corporation and American producers with critical relief. 

Though these recent flat-rolled duty orders stemmed the tide of 

unfairly traded imports from the targeted countries, an all too familiar story unfolded. Low-priced imports surged in from other 

countries. 

For example, imports of cold-rolled and corrosion-resistant steel 

from Vietnam replaced imports from China nearly ton for ton. As 

a result, U.S. producers filed circumvention petitions with the 

Commerce Department in September 2016. Last December, the DeVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 R:\DOCS\35941.000 TIM
14 

partment issued a preliminary affirmative finding that imports of 

Chinese steel finished in Vietnam should be covered by the same 

AD/CVD orders on imports from China. This decision should put 

other countries and other foreign producers on notice that circumvention will no longer be tolerated. 

Another egregious situation is imports of oil country tubular 

goods, or OCTG, particularly from Korea. In 2014, we obtained AD/ 

CVD orders on Korean OCTG and, in the years since, have obtained higher and higher antidumping rates in each administrative 

review. 

However, dumped OCTG imports from Korea have continued to 

surge into the United States. As was noted earlier, total OCTG imports reached a nearly 200-percent increase in 2017 over 2016. 

Korea has no domestic use for OCTG products. 

Our Nation must not tolerate these trade tactics to continue. We 

need American-made steel products to harness our abundant natural resources so we are truly able to achieve American energy security and independence. 

Of particular significance at this moment is the section 232 investigation that was discussed earlier. I will simply say that, if the 

Senator would like to hold a hearing every day between now and 

April 11th when the 90 days is up, we may get a decision much, 

much sooner. 

From U.S. Steel’s perspective, we urge a strong, broad action 

under section 232 on imports that are threatening our national and 

economic security. The threat posed to America’s steelmaking capacity by the unrelenting and growing barrage of imports merits 

aggressive action by President Trump. An effective section 232 

remedy must be comprehensive and broad-based, covering all producing countries and the full range of steel products, including 

semi-finished products, with only limited exceptions for products 

that are not currently available from a U.S. maker. 

We are encouraged by Tuesday’s meeting at the White House, by 

the advocacy from members of Congress, as well as the President’s 

own remarks. We are optimistic that a section 232 action will come 

soon. 

On the hearing’s second topic, investment in infrastructure, this 

is both a necessity and an opportunity for a steelmaker. We depend 

on an efficient, reliable transportation system to move millions of 

tons of raw materials and finished product, and the long-term investment to improve infrastructure creates direct demand for steel 

and fosters broad economic growth and job creation, which further 

drive steel demand. As the infrastructure discussion advances, we 

encourage you to focus on three priorities. 

Increased long-term investment is essential to undertaking largescale projects, those that consume steel. 

Project streamlining is also critical. It will responsibly condense 

the permitting process to lower costs and deliver projects sooner. 

And as has been discussed, the third priority is maintaining the 

commitment to the longstanding Buy America principal that the 

iron and steel that is purchased with taxpayer dollars, the iron and 

steel that is used to rebuild our Nation’s infrastructure, should be 

produced, both melted and poured, here in the United States. That 

15 

is a principle that must be maintained as the infrastructure debate 

continues in the United States Congress. 

Senator Casey, thank you again for your leadership in convening 

this hearing and the opportunity to provide perspective to the Senate on priorities of fundamental importance to U.S. Steel and our 

country. We stand ready to support and assist your important 

work. 

[The prepared statement of Mr. Young appears in the appendix.] 

Senator CASEY. Todd, thanks very much. 

I want to thank our panel for their testimony. Now we will go 

to questions. We will just alternate. Senator Wyden and I will alternate. He has both seniority and rank over me, so there might 

be a time when he gets two questions. I can’t control that. I want 

you to know that up front. 

Let me start with the reality of where we have been the last year 

with regard to the President. The fact that Secretary Ross has this 

press conference, which might be underway now, or press call, and 

the fact that he called Senator Wyden and is announcing something today, that is fine. That is positive, I guess, when you have 

the Commerce Secretary engaged, as he has been, and I have spent 

some time talking to him. But we need to hear from the President 

of the United States. I cannot say it more plainly than that. 

All of us can talk about it, and he can make reports and all that, 

but the central person here in terms of making this determination 

on 232 as well as other issues is the President of the United States. 

The President has talked a lot about taking action, but so far, we 

have not seen it. What we need is action that will lead to concrete, 

positive results for both U.S. companies like U.S. Steel as well as 

United States workers. 

So I guess the first question I have is—I will direct it to both 

Scott and Todd, and anyone else who wants to weigh in—can you 

tell us what happened to imports of subsidized steel following the 

passage of the Leveling the Playing Field Act and how U.S. industries responded? 

Scott, do you want to start? 

Mr. PAUL. Sure, I will briefly. 

Like you, Senator, Todd has seniority over me. He serves on our 

board. So I will leave him to hit cleanup on this. 

But I will just say, with some of the data you have articulated 

already, you saw an otherwise hard-to-explain spike in steel imports, especially considering there had been some dumping orders 

in place, and you can only attribute that to what I would call gaming the system, where you have raised expectations that there will 

be limitations to market access. Importers and countries respond to 

that by surging the market with goods. That relief never came. 

And you have heard various data points here, both very high import penetration to the U.S. market, 27 percent; an increase overall 

in steel imports of at least 15 percent; and obviously, in some items 

like OCTG, up to 197 percent. 

In an environment where there should be expansion in hiring at 

local mills, in some cases, you have seen layoffs, as in Conshohocken at ArcelorMittal, which makes military-grade steel, one of 

the few producers that does that. 

16 

So it has had real and palpable consequences, and I would echo 

what Todd Young said, which is, we need a decision tomorrow on 

this. We have had 270-some days almost, more than that now, of 

deliberation, and it is time to act. 

Senator CASEY. And the gap between the commencement of investigations and the final determination by the President, the reason why that gap of 270-plus days is important is because, in that 

period, you had this import surge of players in the marketplace 

taking advantage of that time gap. That is why the promptness or 

the urgency is critical. 

Todd, do you have something to add on this? 

Mr. YOUNG. Briefly, I would like to add, as I referenced in the 

testimony, soon after the enactment of the acts—it could be measured in weeks and days—the industry launched these three new 

cases on flat-rolled products, successfully pursued those with the 

assistance of the new laws, and relief was gained. Twenty sixteen 

was much better than 2015. 

The challenge, though, is what is often referred to as the WhacA-Mole problem. You address unfair imports from certain countries 

only to now see them enter from another country. In 2017, as has 

been noted, almost every statistic shows an increase of imports 

over the prior year. Overall steel imports are up 15 percent, 2017 

over 2016. There is a growing problem. 

Part of the reason why we were very optimistic about the potential of section 232 is, you are dusting off a tool that has not been 

utilized for some time, and, importantly, it grants broad authority 

to the President to take comprehensive action to address this problem. Some of these problems, as I said, are popping up as a result 

of a recent case. Some of them are intractable challenges that, no 

matter what tool industry has sought to use, it has not stopped the 

unfair trade. 

That is why we are optimistic that a 232 decision can address 

some of these challenges—instituted broadly and across products 

and countries and for a sufficient time for the industry to stabilize, 

to invest in itself, and to strengthen our base here in the United 

States, so that we can provide not only for our national security 

but our broader economic security. 

Senator CASEY. Todd, I think it is significant what you said just 

now and also what you said in your testimony. You are talking 

about acts of Congress—the Leveling the Playing Field Act and the 

ENFORCE Act, which Senator Wyden played such a leading role 

in—acts passed by Congress actually having a positive impact on 

this issue. And if we can couple those acts and the tools therein 

with actions by the President, we can make real progress. 

I will make two points before I turn it over to Senator Wyden. 

I worry sometimes that the audience who might listen to this later 

might not have a real sense of what we are talking about when we 

say ‘‘232.’’ Just so they know, Scott mentioned the 1962 legislation 

President Kennedy signed. Here is the basic 232 focus. This review 

that has been undertaken by the administration, announced all 

those days ago, focuses on one thing: whether imports adversely affect, number one, U.S. national security, so whether an import 

from another country, an unfair advantage, is adversely impacting 

17 

our national security, that is one, and could result in trade restrictions on imports. 

So that is what the President’s determination will focus on, and 

I cannot think of a more urgent issue than our own national security, as well as our economic security. 

So I am going to turn it over to Senator Wyden. 

Senator WYDEN. Senator Casey, I am going to pick up right 

where you left off, because I think now we are going to kind of try 

to wrap up what we think the problems are and then go to kind 

of the remedies. 

In your view, Mr. Young, what as of today are the most significant trade violations affecting you as a U.S. manufacturer and, obviously, your workers? 

Mr. YOUNG. I discussed several of them in the testimony, but to 

sort of summarize them: one, there is the fundamentally unfair imports that are dumped below the cost of production in the U.S., 

which certainly threatens our ability to compete fairly. There is 

also the challenge of foreign governments that are subsidizing 

those products into the United States. Often, these are addressed 

through our antidumping/countervailing duty portion of the law. 

When that portion of the law is successfully pursued, then we 

have a question of enforcement. Is it now going to come in from another country? Is Chinese steel going to Vietnam and then coming 

into the United States? A recent decision by the Commerce Department seeks to address that. 

We also have a situation where there is a question as to whether 

there is simply fraud involved with the payment of Customs duties. 

We have a host of these problems when it comes to Korean OCTG 

in general. 

So I would say there are just fundamental unfair imports, and 

then there is the cheating to get around when our laws put a duty 

in place to protect us. 

It was referenced earlier, we at U.S. Steel have also been attacked by a cyberspace attack where we were one of several Pittsburgh institutions targeted by the Chinese military for our intellectual property. We have spoken about this publicly. We cooperated 

with the Department of Justice here in western Pennsylvania when 

they succeeded in pursuing indictments against these Chinese military leaders. 

So we see an array of challenges. Like we said, the improvements in the law have helped us fight back against those. The challenge is that, oftentimes, they breed new attacks and new avenues 

of unfair trade. The other side is not resting in their efforts. 

Senator WYDEN. You are so right about the other side not resting, and I am going to get into that here in a moment with respect 

to one of the more imaginative ways in which they cheat, because, 

as you know, the gentleman behind me ran a sting operation. We 

set up a dummy website that was designed solely to try to catch 

trade cheats and invite people from around the world to essentially 

be in touch with the dummy website, and we were flooded. So we 

are going to talk about that, I think on my second round, in terms 

of merchandise laundering, as we came to describe it. 

But I think what you said—I want to make sure, because it highlights Senator Casey’s point about how valuable 232 is—is that 

18 

that begins to, again, deal with this end-run through relocations 

and the like. Is that a fair statement? 

Mr. YOUNG. Rather than tackling this on a case-by-case, productby-product, country-by-country basis, section 232 allows a comprehensive remedy to basically weave together solutions to each of 

those challenges. 

Senator WYDEN. Senator Casey? 

Senator CASEY. I wanted to focus on the two broad topics we are 

here to discuss today, and I open this up to anyone on the panel. 

On the one hand, we are dealing with this issue of cheating, 

which is significant, and obviously, anytime you allow a cheater or 

a cheating strategy to remain in place or to be unfettered, you are 

going to have a bad outcome for the country that is the victim of 

the cheating, and that happens to be the U.S. So that is cheating 

on trade. That is part of what we are talking about today. But also, 

when we under-invest in our infrastructure, we are cheating ourselves as a Nation. 

So you have both at work here. Both are pernicious. One is imposed upon us by another country or several countries when they 

do dumping and take other actions that are adverse to our workers 

and to our companies. But the other cheating is on us, if we don’t 

make the investments we should be making. 

So I wanted to open it up to the panel on both of those issues. 

In particular, maybe I will direct this to Scott. 

One of the tools that we have is Customs and Border Protection. 

How do you feel Customs and Border Protection is doing with regard to efforts to identify, prevent, and address duty evasion and 

circumvention, if you can describe what we mean by both? 

Mr. PAUL. Sure. Thank you for the question, Senator Casey. I 

think it is a great one. And I am glad that Senator Wyden mentioned the sting operation, because it really brought to light the 

type of challenges that we have seen. This goes back to the point 

of my testimony, which is that trade enforcement has not been at 

the core of our strategy for a very long time. 

Customs and duty evasion and circumvention occur because 

there is opportunity and because there is lack of enforcement. The 

opportunity is that, even though we are only 5 percent of the population, we have an outsized amount of consumption compared to 

the rest of the world, so we are an attractive target. And our border 

protections with respect to fairly traded goods are really underfunded, and that has had serious consequences for products that 

range from steel and other metals to consumer products. And with 

digital platforms being available to sell this, it is expanding exponentially. 

It is something, again, that I think most average citizens probably do not think about, but it has a real and palpable impact on 

the ability of our companies to be competitive. And this is where 

we underperform, to your point. 

Our industries that are in global competition have not grown as 

fast as the rest of our economy for a very long time. And it is not 

because we do not have great workers. You heard Rick’s testimony, 

in terms of the efficiency of a steelworker. It is not that we do not 

have amazing entrepreneurs. We clearly do. But it is that our public policy has not caught up, and some of that starts with those 

19 

very wonky, specific, and boring but essential enforcement mechanisms that have been underfunded and underappreciated. 

Senator CASEY. Along the lines of wonky, can you describe for 

the audience what you mean by duty evasion and what we should 

do to combat it? 

Mr. PAUL. Sure. Duty evasion—I guess there are two types. 

There is a straight-up duty evasion, which is whatever our normal 

tariff schedule is. Then there is duty evasion when it comes to, say, 

dumping orders having been opposed, or countervailing duty orders. 

By those I mean—those are essentially extra taxes put on specific imports, specific lines of products from specific countries that 

have been found to have been dumped. They sometimes range from 

5 percent up to 200 percent or 300 percent. There are lots of different ranges there. 

But there is a boutique market for both mislabeling and shielding these types of imports from enforcement. So they are essentially contraband coming into our country. And they have harmful 

impacts in different ways, obviously, than opioids or other sorts of 

harmful products, but they harm our economy and they harm our 

workers. 

And I am glad that the work of the Finance Committee, of Senator Wyden, has shed some light on this. We need stepped-up enforcement of this. 

Senator CASEY. I want to open it up, Rick and Petra, if you have 

something on this. And I have a specific question for Petra after 

that. 

Rick, anything on this, in terms of the worker impact? 

Mr. GALIANO. Senator, what the worker impact is—I am kind of 

a person who sees the end result when an individual gets laid off 

and comes to our halls and goes over things that he or she had in 

the last 5 years that are all gone, and trying to get that individual 

back to work, getting them some relief, getting them some benefits, 

after the 6 months of unemployment that they lose, trying to get 

them on TRA benefits, trying to get them another field of employment after education. Like I said, then I see what happens to communities, the impacts of what goes on. 

So it is disheartening to see these things go on and to try to get 

the foreign imports out when our hands are tied sometimes, and 

we can’t do anything about it until the government works with us. 

Senator CASEY. Petra? 

Ms. MITCHELL. I think the impact on the supply chain is similar. 

When the steel industry is impacted and in decline, that ripple effect goes through the entire supply chain and puts a lot of added 

pressure onto smaller companies to continue to diversify, seek new 

markets, and look for other ways to keep their employees, because 

they certainly do not want to lose good employees due to the workforce challenges that I mentioned as well. So there is definitely a 

significant downstream impact. 

Senator CASEY. Petra, I also want to put in a commercial. I am 

admitting up-front this is a commercial for your operation. 

Ms. MITCHELL. I will take it. 

Senator CASEY. I am not saying this just because Governor Casey 

created the program in Pennsylvania back in the 1990s, but why 

20 

the hell, if I can say it that way, would any administration eliminate funding from the Manufacturing Extension Partnership? I 

wish someone in the administration could come to me and show me 

the report that justifies eliminating that program. They do not 

have a report. It is some budget guy who does not know anything 

about it, does not care about it, does not know Pennsylvania and 

a lot of other States, saying we do not need this program. 

So the only good news here is Democrats and Republicans in 

both houses will oppose the elimination of MEP, and that is the 

good news. But we cannot assume that is going to happen. 

So, Petra, I want you to know, we are going to fight to get the 

funding for MEP in place. But this is the second year in a row now 

they have tried to eliminate it in their budget. 

And I will wait 100 years for an explanation and still not have 

it, because there is no explanation other than some green-eyeshade 

guy in Washington who doesn’t know our States, certainly doesn’t 

know my State, talking about eliminating it. 

So that is my commercial, and I am sticking to it. 

Todd, I know we want to go to Senator Wyden, but anything on 

these issues? 

Mr. YOUNG. Just briefly on the question about duty evasions and 

Customs and Border Protection. Following enactment of the ENFORCE Act, I will credit the agency for their outreach to the steel 

industry. That has continued, actually will continue through 2 

weeks from now, when the Acting Commissioner himself—he is 

pending permanent Commissioner—is meeting with the steel industry. We also had a delegation of Customs personnel from 

around the country recently, either in 2016 or early 2017, visit our 

research and technology center here in Munhall, PA to learn more 

about steel, how to identify products, how to distinguish between 

those so that they know that a product that has a rightful duty on 

it, they are collecting it. They are not trying to misidentify the 

product to evade that duty. 

Senator CASEY. Todd, thank you for that. 

Senator Wyden, we are probably going to be wrapping up in 

about 10 minutes. 

Senator WYDEN. Great. I just want to say, before we leave this 

matter of kind of how we go after the trade cheats who get busted, 

in effect, for dumping and unfair subsidies, and this did affect the 

steel industry, as we have been talking about. One of the things 

that Senator Casey and I were very interested in is, in the past, 

the reason the government would drag its feet is there was no trigger to make enforcement mandatory. I remember you and others 

told Senator Casey and I, ‘‘You have to change that. You have to 

have strict timelines to make sure the government actually brings 

down the hammer, and there has to be action.’’ 

So we have appreciated you working with us, and I think that 

was one of the big developments after we did the big sting operation, and you all told us what was going on. 

I am going to wrap up with one point. I may have touched on 

it with Senator Casey. But Oregon and Pennsylvania have another 

thing in common, something probably both of us would rather not 

be the case, be able to pass on it, and that is, both of us had our 

21 

companies hacked by the Chinese. And I know that the Chinese 

stole intellectual property from you all, Mr. Young. 

As you know, our solar manufacturer—we don’t have very many 

solar manufacturers left in the United States—they also had intellectual property hacked. And in both cases, the Chinese were indicted for actually engaging in this kind of action. 

So I will just close, I think, Mr. Young, by having you tell us, 

what was the implication of the Chinese hack on you all, and how, 

in your view, can the 301 case be used to get China to eliminate 

unfair policies? 

Mr. YOUNG. As you noted, we were twice the victims of cyberespionage, which included the indictment of members of the Chinese military. They specifically, in a second spear-phishing attack, 

sought to exfiltrate confidential business information related to advanced high-strength steels. We spent considerable effort, time, resources, and money to develop this technology. It is the direction 

in which steel is moving. It is lighter. It is stronger. It is what the 

auto industry needs to meet efficiency standards but also still protect the occupants of those vehicles. 

The full implication of it is not known. We did bring a separate 

legal challenge against Chinese producers based upon this attack. 

One of the things we found is that the law passed several decades 

ago was not as efficient in processing a cyber-espionage attack, but 

we thought that was an important principle, to not let that matter 

rest. 

The full impact of it is that, if you can steal from us what we 

have spent years and extensive resources developing on the next 

generation of steel, and you do not go through that process yourself, certainly a shortcut would help potentially an entire industry 

in China which has half of the world’s steelmaking capacity. 

Senator WYDEN. Does anything about this relate to 301 and 

using it? 

Mr. YOUNG. We actually filed comments when the 301 process 

was initiated, noting, in particular, part of the 301 effort is targeted on the sort of mandatory voluntary transmittal of intellectual 

property in order to do business in China. What we wanted to have 

on the record, which was known, but to reiterate, is that it is not 

just a matter of them making you take a step to engage in their 

markets. They attack us, and they do it through cyberspace. 

The question of exactly how a 301 could be used in that front, 

we are very curious to see the outcome of this report, similar to the 

232. We expect that it is coming. But we have, obviously, taken 

steps since that time to seek to prevent a similar outcome. We are 

not seeking to produce steel in China. We are happy to produce it 

here as a 100-percent American company, from the raw materials 

to the final steel produced. 

To the degree they have some of our confidential business information and are using it, our priority would be to not let that product into our country. 

Ms. MITCHELL. Senator, maybe just a quick comment. 

Cybersecurity is a huge, huge issue for small manufacturers as 

well. As you can imagine, they are resource-constrained. They do 

not have the full IT staff and departments to really manage that. 

22 

But also, they are targets. Small companies are targets for financial fraud, for financial risk. And we suspect, very soon, they will 

be targets for stealing of intellectual property, as was already mentioned, and also shutting down of production facilities. One small 

company can be a critical element of a supply chain. You shut that 

company down, and that whole supply chain can be shut down. 

So again, it is a major issue not just for large companies, but for 

small ones as well. 

Senator CASEY. Thanks. That may be the last, unless Senator 

Wyden has one. He certainly has the opportunity to ask another 

question. 

I want to turn to Rick Galiano. Rick, we were with the President 

on Tuesday, as I said, around a long table. And that was a good 

discussion we had. I brought up—it wasn’t by way of the question, 

it was just urging the President to act in a time frame shorter than 

the 90 days. I probably should have used the number 60, because 

there are only about 60 days left for him to decide. 

But I said that because of this delay. I know some people listening might say, ‘‘Oh, there goes a member of the United States Senate complaining about government inaction, and government is always slow. What is different about this one?’’ What is the difference, right? 

But this one, this delay, has real consequences for the surge of 

imports. And obviously, what flows from that are real, adverse consequences for the workers. 

If you can, walk through that a little bit and just give us a sense 

of what this means, what this delay means, what this lack of a 

remedy means in the real life of a real worker? 

Mr. GALIANO. Every day it delays is every day an employee may 

lose their job, a member may lose their job. As that continues, with 

foreign imports, the industry itself slows down, and the unemployment office gets busier because they lose their jobs. 

So in fact, if this is stalled any length of time, we are going to 

have issues dealing with the last depression or recession that we 

had 5 or 6 years ago or 7 years ago with the factories being 50- 

percent idle, as it was back then. 

The plant that I come out of, it just started getting busy in the 

last 2 years. Four years before that, it was slow, and it came into 

a cycle that they are busy again. But with the foreign imports coming into this country as fast as they can, I fear that the same thing 

is going to happen going forward if this doesn’t pass within the 

next 6 months or 3 months. 

Senator CASEY. In your testimony, when you talked about recent 

action to put more tools in the toolbox, you said, I think it is the 

first page of your testimony, when you talked about the passenger 

vehicle, light truck tires issue, you talked about a $3-billion investment into U.S. tire plant expansions and factories because you had 

that tool available. 

Mr. GALIANO. Correct. 

Senator CASEY. Seven thousand, two hundred union tire workers 

at Goodyear reached a new 5-year agreement. 

In other words, you have tools. You use those tools for enforcement. And you get results for American workers. 

23 

Mr. GALIANO. And with a 5-year agreement, no employee will be 

laid off for the full 5 years. 

Senator CASEY. So what we are trying to do together is get the 

same results for steelworkers and others just like what happened 

in the tire context. So it is a good analogy, a good comparison. 

Senator Wyden? 

Senator WYDEN. I think this has been very, very helpful, Senator 

Casey. We started out, whatever it was, 11⁄2 hours ago or something, talking about how, in life, sometimes, particularly for us in 

the Senate, you can be talking about something and everybody 

says, ‘‘That is interesting. Let’s come back in 6 months or 8 months 

and find out what is going to happen.’’ But what you have done by 

scheduling this hearing—and we have been kidding, we went to the 

meetings, we scheduled the hearing, and all of a sudden we are 

going to get results. But this is not the first time you have led our 

committee on these issues, as we have talked about with respect 

to the ENFORCE Act and the Leveling the Playing Field Act. And 

in effect, keeping the pressure on day in and day out has helped 

us, as I have described it, begin a fresh approach on trade that I 

have come to call trade done right. 

So I just want you to know I very much appreciate you giving 

me this invitation. We have learned a lot of valuable facts here 

today. And I think all of you Pennsylvanians can expect to see Senator Casey and I, to some extent, perhaps as early as this afternoon, start commenting on some of the things that the President 

may want to pursue. And we will talk about what the voices of 

Pennsylvania have had to say about it. 

Senator CASEY. Senator Wyden, thanks very much. We are grateful you are here and grateful for your leadership on these issues. 

I have to say that I don’t know exactly what was said on the conference call that Commerce Secretary Wilbur Ross had at, I guess 

10:30. We will learn that soon. But here is what I hope happened. 

It is a little bit of fiction, but it lightens the mood a little bit. 

I am hoping that Secretary Ross got on the phone, and before he 

walked through too much of his presentation, that he was there 

solely to be introducing another person on the phone, and the 

President got on the phone and made an announcement. I do not 

think that happened, but I am hoping, because we want to hear 

from the President on 232. We want to hear from the President 

that he is going to use every tool at his disposal to fight back 

against China cheating, to fight back against any country trying to 

take our jobs, and to put in place bipartisan approaches to create 

and retain jobs. 

I referred to this letter the other day when I had my 2 minutes 

of comments. I referred to a February 1st letter the President received, and this is signed by, if I count the signatures, by about 25 

steel executives. I will not read all of it, obviously, but the one 

thing that they said in this letter, among many important points— 

and I reiterate this today for what I hope will be the determination 

by the President—they said, talking about a 232 decision, ‘‘We urge 

you to implement a remedy that is comprehensive and broad-based, 

covering all major sources of steel imports and the full range of 

steel products with only limited exceptions for products not currently available in the United States.’’ 

24 

A lot of words there, but the most important are, they want a 

remedy that is comprehensive and broad-based. The President was 

advised by some members of Congress in the room to be narrow 

and focused and limited and balanced and all that. That always 

sounds nice, but when it comes to American workers, we do not 

want to be limited. We do not want to be balanced. We want our 

workers to win based upon the actions the Federal Government 

and the Congress can take. 

We do not want to be targeted. We want to win these races. We 

want to get these jobs and keep these jobs, because, as was pointed 

out earlier—Rick, I think you made the point—when folks lose jobs 

in these circumstances, it is not something that that worker did or 

that company did. It is because other companies are cheating, and 

we are not holding them accountable, even though we have all the 

tools to do it. We have to make sure that becomes the case. 

You know, I have said it a thousand times. I will say it again. 

We had a statue, a bronze sculpture, I should say, that was put in 

front of the Governor’s residence in Harrisburg. The guy that put 

that there I knew pretty well. And he got support from every union 

in the State of Pennsylvania to build that bronze sculpture of a 

steelworker putting in place a steel beam. He said the reason he 

put it there was to remind every future Governor about what steelworkers meant to the country, how they built our country, and how 

they helped us outproduce the world to—guess what?—win World 

War II. That is about all they did, right? 

And it is about time that we take a similar approach and have 

a similar determined spirit to fight on their behalf when it comes 

to protecting their jobs. If they have a level playing field, if we enforce the law, if we hold other countries accountable, and if we 

bring cheaters to justice, so to speak, guess what? Steelworkers or 

all of our workers can outcompete the world and do as their ancestors did to win World War II and to win any war, whether it is economic or otherwise. 

So that is all we are asking. We are not asking for something 

extra here. We are just asking for people to enforce the law, use 

the tools that you have, and win these races, win these fights for 

our workers. 

So I am so grateful that our panel was here with us today to give 

us a perspective on this. I am certainly honored to be here at the 

Community College in Beaver County. 

And, Senator Wyden, we are grateful that you took the time to 

travel to Pennsylvania. We are also even more grateful for your 

work on the Finance Committee on these issues. 

So, unless there is anything further, we are adjourned. 

[Whereupon, at 11:19 a.m., the hearing was concluded.] 

(25) 

A P P E N D I X 

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD

PREPARED STATEMENT OF HON. ROBERT P. CASEY, JR., 

A U.S. SENATOR FROM PENNSYLVANIA

We’re here today to discuss what I view as two of the most critical issues that 

relate to the competitiveness of our Nation: manufacturing and infrastructure, 

which have a substantial impact on jobs and wages. I’m honored to be joined today 

by Senator Wyden, who came from Washington to be with us, but as you know represents the State of Oregon and has worked for years on all these issues—trade 

issues, economic and jobs issues, manufacturing, infrastructure, and the like. 

We know that steel overcapacity, as well as trade cheating and China’s efforts to 

literally steal our future by stealing our companies’ IP, are some of the most fundamental trade issues of our time because they directly impact Pennsylvania jobs and 

wages. I’ve said for years and I’ll say again: when China cheats, Pennsylvania loses 

jobs. It’s that simple. So we have to face that reality when we’re confronting these 

issues. China is going after America’s competitive advantage by any means necessary; if China can’t buy it, or if China can’t run it out of business, they steal it. 

And unfortunately that’s a harsh reality. You don’t need to look far in our State 

to find companies and unions who have been hacked by the Chinese government. 

Just talk to U.S. Steel, talk to the Steelworkers, talk to other institutions in southwestern Pennsylvania who have been victims of these actions. 

I went to the White House this past Tuesday to meet with the President and a 

bipartisan, bicameral group of legislators—Senators and House members of both 

parties, including Senator Wyden—to discuss steel and aluminum. At that meeting, 

I told the President how Pennsylvania companies and steelworks have been hammered by the surge in imports since the Commerce Department announced its section 232 investigation last April on whether rising steel and aluminum imports represent a threat to national security. I also heard from Senators telling the President 

to exercise caution—that’s what a number of Republican Senators and House members were telling him. I have a different view, which we’ll get into later. 

When the Commerce Department launched this investigation in April of last year, 

I along with steelworkers across Pennsylvania were hopeful that the Commerce Department would quickly complete their study, and the President would take decisive 

action. And then, we waited. Through the spring and the summer, rumors were 

swirling, but still steel imports were surging. The Commerce Department seemed 

ready to transmit the report by the end of the summer and then the President told 

The Wall Street Journal in July that he did not intend to move forward on a final 

determination on the steel section 232 case until ‘‘everything finished up between 

health care and taxes, and maybe even infrastructure.’’ So said the President at that 

time. Meanwhile, we watched imports rise for the first 12 months of 2017—total 

steel and finished steel imports were up 17.5 percent and 14.6 percent, respectively, 

from the same period in 2016. So total steel basically up 18 percent, and finished 

steel imports up basically 15 percent in that time period. Imports of electrical steel, 

which many of you know is the steel used to ensure we have an electricity grid, 

have more than doubled from 2016 to 2017. Pipes and tubes surged 82 percent from 

16 percent to 17 percent. So electrical steel up 100 percent, pipes and tubes up 82 

percent. 

The Commerce Department had 270 days to transmit the report to the President, 

and they submitted it just shy of that by a few days. The President then had 90 

26 

1http://www.rubbernews.com/article/20160913/NEWS/309059996/tire-makers-invest-10-bil 

lion-in-expansions-improvements and http://www.rubbernews.com/article/20170911/NEWS/ 

170919998/tire-makers-spend-big-on-new-plants-expansions. 2https://www.usw.org/news/media-center/releases/2017/usw-members-overwhelmingly-approve-goodyear-contract. 

days to make a determination. At the White House this week, I urged him not to 

take that long and move swiftly on this long-delayed relief. 

I said earlier we can’t allow China to steal our future, and that’s not drama and 

hyperbole, that’s the truth. If we allow them to continue on the pathway that 

they’ve been on, they will steal our future. Actions matter, and the actions we take 

today must be directed at long-term outcomes we want for our children and grandchildren. This means an economy that creates opportunity for all Americans and a 

system that creates a fair environment for our workers to find jobs that pay familysustaining wages. This also means investing in our roads and bridges, schools, locks, 

and dams which are so important to commerce here in southwestern Pennsylvania, 

and of course our electric grid, and broadband. Infrastructure matters. It’s about our 

security, it’s about our safety, and it’s about our jobs. So this means putting real 

Federal dollars behind infrastructure that is fundamental to our combined competitiveness. 

I believe you can do infrastructure one of two ways: you can do it the corporate 

way, which is not the way to do it, or you can do it the American way. I want an 

American infrastructure bill. It means we’re all in this together, we’re all one American family. We ought to put public dollars in, and big dollars, to really make a difference and create jobs. So this means making sure that the inputs to that infrastructure are made in America. I think both parties agree on that, and I’m grateful 

that Senator Wyden is here today to make these points and to discuss these critical 

matters for the economy of Pennsylvania, the jobs of Pennsylvania, as well as American jobs and American competitiveness. 

PREPARED STATEMENT OF RICK GALIANO, PRESIDENT, 

BEAVER LAWRENCE COUNTY CENTRAL LABOR COUNCIL

Mr. Chairman, members of the committee, it is an honor to speak with you at 

this field hearing on Trade Enforcement and Infrastructure. My name is Rick 

Galiano, and I am president of the Beaver Lawrence Labor Council and a United 

Steelworker (USW) member. My testimony to you today is straightforward; I try to 

do everything in my power to improve the livelihood of our union brothers and sisters, our communities, and our country. I want Congress and the administration to 

do the same. My concern is that the tools that our country has to defend its manufacturing base and move it further into the new millennium have been improved, 

but much more must be done. 

Since Congress passed the Leveling the Playing Field Act and the ENFORCE Act 

a slew of trade enforcement cases followed. The much-needed trade law improvements in the Leveling the Playing Field Act were critical to the success of those 

cases and Senator Wyden’s ENFORCE Act is necessary when those that trade unfairly try to game the system. Since then, some of our international competitors 

have tried to deride these changes as ‘‘protectionist’’; instead I see the day-to-day 

results when a worker gets a job back or their hours increase. And I also see the 

potential if we could do more. Restoring fair play and ensuring that we have a fair 

chance to compete internationally is all we ask. 

For example, since the USW successfully brought forward an antidumping and 

countervailing duty case on Passenger Vehicle and Light Truck (PVLT) tires against 

China in 2015 and off the road tires from India last year, close to $3 billion have 

been invested into U.S. tire plant expansions and factories.1 Seven thousand two 

hundred union tire workers at Goodyear reached a new 5-year agreement with wage 

improvements and an extension of plant protection guarantees where no USW 

plants will close during the term of the agreement.2 To the doubters of the value 

of trade enforcement, I dare them to look one of those workers in the face and tell 

them they are not worth ‘‘protecting.’’ 

I wish I could say there is a similarly positive outcome in the steel industry as 

there is in the tire industry. Since the passage of the Leveling the Playing Field 

Act, 67 anti-dumping and countervailing duty orders against a multitude of countries have been put into effect. While those trade enforcement cases in the steel inVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00030 Fmt 6601 Sfmt 6621 R:\DOCS\35941.000 TIM
27 

3https://www.steel.org/Steel_org/document-types/news/2018/decembershipments.aspx?site 

Location=c481cc99-d816-4613-805c-b90af33cc162. 4http://www.steel.org/∼/media/Files/AISI/Press%20Releases/2018/IMP1712.pdf. 5https://www.usw.org/news/media-center/articles/2017/thanking-those-who-stand-with-us. 

6http://www.steel.org/about-aisi/industry-profile.aspx. 

dustry worked through the year-long process to get tariff relief, almost 19,000 steelworkers that were laid off in 2015 at idled or underutilized facilities across the 

country waited. Too many are still waiting. And, let’s remember, those trade cases 

are simply about addressing foreign unfair trade in line with international rules we 

weren’t asking for anything that the law wasn’t designed to provide. 

While workers waited, the steel industry last year shipped 90,886,717 net tons, 

a 5.0-percent increase, which is promising on the one hand but the industry operating capacity hovers in the low 70s, meaning roughly 25 percent of our country’s 

steel making capability sits idle or underused.3 While global overcapacity still gets 

talked to death at the Global Forum of Steel Overcapacity and at the Organization 

of Economic Cooperation and Development (OECD), USW has been cautiously optimistic about the chance for unilateral relief through the implementation of more exotic trade enforcement mechanisms like the section 232 steel and aluminum investigations currently in President Trump’s hands. 

As you are aware, section 232 is a part of U.S. trade law that gives the Commerce 

Secretary the ability to investigate whether certain import levels pose a national security threat. USW firmly believes that our Nation’s military and critical infrastructure needs are essential to our national security. The industry cheered last April 

when President Trump announced a section 232 investigation into steel imports— 

but we are still waiting for results. 

When President Trump and administration officials had pledged to unveil the 

findings of the section 232 investigations by July 1 of 2017, we were hopeful at first 

and left wondering each day after. Now it is over a month since the Commerce Department submitted the 232 steel and aluminum reports to the President, and 

they’re still sitting on his desk. Those reports initiated over 270 days ago by the 

Trump administration appeared to be an attempt to fulfill a campaign promise to 

manufacturing workers. 

By delaying the 232, the foreign steel industry saw an opening. While the U.S. 

has shipped more steel this year, finished steel import market share was 27 percent 

for full year 2017. Total and finished steel imports are up 15.4 percent and 12.2 percent, respectively.4 The economy has grown but the U.S. steel industry continues 

to fight a barrage of foreign steel products. Most of the growth in our market is 

going to imports—not to our own steel mills and steelworkers. 

However, our union has not been idle, knowing that others would try to undermine the 232 investigation. USW members across the country have stood up asking 

for the Congress and the administration to do its job and defend the most efficient 

and advanced manufacturing industry in the world. Since the initiation of those investigations, over 120 Representatives and Senators submitted letters to the Department of Commerce or the President urging action on the investigations.5 Almost 

15,000 Steelworker union members from across the country wrote the Department 

of Commerce asking for a conclusion and successful remedy. 

Promises and rhetoric can only go so far. The actions we take as a country to create a better deal for American workers will be the measure by which union members and voters judge our elected officials. 

U.S. workers should not fear globalization, but it requires our elected leaders to 

focus not just on corporate profits but on the distribution of that wealth. Our trade 

laws need to reflect a more globally connected world and the potential for abuse by 

bad actors. We are using tools developed in the last century to fight a war in this 

one. A modern steelworker in this country can make 1.9 tons of steel per man hour; 

I want our country’s trade laws to be that efficient and effective.6

The Finance committee has the potential to not just upgrade our trade laws but 

also set a path to renew our Nation’s infrastructure. The great accomplishments of 

the 20th century in this country need maintaining and unlocking the potential of 

the 21st century requires leadership from all levels of government including this 

committee. 

Even though the U.S. Congress and some States have recently made efforts to invest more in infrastructure, these efforts do not come close to the $2.0 trillion in 

28 

7https://www.infrastructurereportcard.org/wp-content/uploads/2016/10/ASCE-Failure-toAct-2016-FINAL.pdf. 8https://www.recode.net/2017/6/20/15839626/disparity-between-urban-rural-internet-accessmajor-economies. 9https://www.infrastructurereportcard.org/cat-item/roads/. 

needs as reported by the American Society of Civil Engineers (ASCE). Infrastructure 

is the backbone of the U.S. economy and a necessary input to every economic output. It is critical to our national defense. 

The cost of deteriorating infrastructure takes a toll on families’ disposable household income and impacts the quality and quantity of jobs in the U.S. economy. 

ASCE estimates that from 2016 to 2025, each household will lose $3,400 each year 

in disposable income due to infrastructure deficiencies.7

If I paid only half my mortgage payments, I would lose my home. Yet as a country 

we are only paying half of America’s infrastructure bill, leaving an investment gap 

and an electorate stuck in gridlocked traffic on outdated roads or crammed into unreliable and unsafe mass transit systems. It diminishes our competitiveness by increasing costs to business and getting products to markets. I worry that by failing 

to meet our country’s infrastructure needs we will indeed be at risk of losing the 

cohesion of our great country. I want to put a few examples in front of you today 

to reflect on. I do not know all the solutions to these problems but just like every 

USW member, I am willing to roll up my sleeves to fix these problems. 

• In today’s increasingly digital world, 88 million citizens in urban and rural 

America lack affordable or any broadband access.8

• It is estimated that leaky, aging pipes are wasting 14 to 18 percent of each 

day’s treated water; the amount of clean drinking water lost every day could 

support 15 million households. 

• Due to the lack of investment, the number of deficient high-hazard potential 

dams has also climbed to an estimated 2,170 or more. It is estimated that 

it will require an investment of nearly $45 billion to repair aging, yet critical, 

high-hazard potential dams. 

• One out of every 5 miles of highway pavement is in poor condition and our 

roads have a significant and increasing backlog of rehabilitation needs.9

• The most recent estimate by the American Society of Civil Engineers puts the 

Nation’s backlog of bridge rehabilitation needs at $123 billion. 

We are fast closing in on 20 years into the new millennium and the Federal Government cannot just be a partner with States and private entities. Nor can it improve infrastructure by privatizing or selling public assets. We need the Federal 

Government to be a leader. We need to set policies that maximize the public good 

for our infrastructure not just for the short term but the long term. 

We need to ensure our tax dollars are used to maximize the economic benefit with 

domestic procurement policies like Buy America. We must ensure that products actually qualify under the act. Foreign producers have been pushing to undermine our 

melted and poured standard so that only 10 percent of the actual work would be 

done in this country as they ship slabs into the U.S. hoping that minor transformation here would confer preferential procurement status. Loopholes and gimmicks aren’t acceptable. We need to avoid privatization for the sake of privatization. 

We need to ensure workers receive a living wage for the work they do to bring our 

infrastructure into the 21st century. 

In closing, I know with a strong trade enforcement strategy combined with a concerted effort to renew our infrastructure we create a better America. Workers in 

Pennsylvania, the country and every USW member have faith that we can use the 

last 10 years of economic turnaround to springboard into the future but we look to 

you as our elected leaders to accept that faith and lead. 

PREPARED STATEMENT OF PETRA B. MITCHELL, 

PRESIDENT AND CEO, CATALYST CONNECTION

Good morning. My name is Petra Mitchell, and I am the president and CEO of 

Catalyst Connection, an economic development organization that for over 30 years 

has been dedicated to serving our region’s small and medium-sized manufacturers. 

On behalf of our board of directors, our staff and our clients, I assure you we are 

passionate about manufacturing. 

29 

Manufacturing in this country is a $2-trillion sector, with over 11 million workers 

and approximately 293,000 establishments. Manufacturing in southwestern Pennsylvania is a $12-billion sector with 93,000 workers and approximately 3,000 establishments. Many of these establishments are closely held, privately owned, or family 

owned businesses, and Catalyst Connection has worked with about half of them 

since our inception and 153 in the last year. 

To enable us to do our work, Catalyst Connection is funded in part by the National Institute of Standards and Technology (NIST) Manufacturing Extension Partnership (MEP) program and by the Pennsylvania Industrial Resource or IRC program. The IRC program was started by Governor Robert Casey, Senator Casey’s father, and was a model for the national MEP program, both of which have been in 

existence since the late 80s. 

This morning I’d like to provide an overview of the MEP program, the challenges 

that small and medium-sized manufacturers are facing, and the role that the MEP 

program and Catalyst Connection are playing in helping to address those challenges. 

OVERVIEW OF THE MEP PROGRAM

The MEP program is a Federal public-private partnership that provides small and 

medium-sized manufacturers (SMMs) technology-based services they need to thrive 

in today’s economy and create well-paying manufacturing jobs. MEP is managed by 

the NIST and implemented through a network of industry-led centers located in 

every State. 

MEP is a proven partnership that can help President Trump achieve his vision 

and commitment for American manufacturing and its workforce. 

SMMs account for nearly 99 percent of all manufacturing firms in the United 

States, and MEP is the only Federal program dedicated to serving them. These 

firms comprise the supply chains of Fortune 500 manufacturers and drive our Nation’s economy. Due to their need for manageable and customized services, they are 

often overlooked by for-profit consulting and technology firms but need those services to compete, grow, and create jobs. The MEP centers fill that gap. In 2016 alone, 

more than 26,000 SMMs utilized the MEP network. 

MEP returns $8.70 to the Federal Treasury for every $1 invested. 

As a public-private partnership, MEP delivers a high return on investment to taxpayers. The Upjohn Institute for Employment Research conducted a study of MEP 

this past year and found that the program generates an 8.7:1 return on investment. 

Each year, an independent firm surveys manufacturers regarding the impact they 

have achieved from MEP Center services. In 2017, MEP clients reported $12.66 billion in new and retained sales and the creation or retention of 110,721 jobs. Considering that the average U.S. manufacturing worker earns more than $82,023 in 

wages and benefits per year, MEP clients are economic drivers in their communities. MEP clients are also increasing their capacity for the production of goods. 

MEP clients reported $3.5 billion in new investments directly attributed to their 

work with MEP. 

Manufacturers served by MEP make a substantial economic contribution. 

Since 1988, MEP clients reported 884,596 jobs created and retained, high-paying 

jobs that have a large multiplier effect. Each of these jobs creates 3.4 full-time additional jobs, totaling more than 3 million additional jobs in local communities. The 

total job impact by the MEP Program generates significant local, State, and Federal 

tax revenues. 

Manufacturers pay to utilize MEP—so it’s not free. 

SMMs pay for the direct costs of the services they receive. This fee for service 

meets the Federal cost share requirements, requires MEP Centers to offer services 

that are of value to the manufacturing community, and encourages SMMs to seek 

a return on their investment, which is more likely to sustain the improvements and 

generate local economic impact. 

Congress has just reauthorized MEP through the American Innovation and Competitiveness Act. 

By voting unanimously to pass the American Innovation and Competitiveness Act 

(S. 3084) which was signed into law on January 6, 2017 (Pub. L. 114–329), Congress 

30 

has provided a major boost to the Nation’s economy by encouraging growth in the 

manufacturing sector through advanced manufacturing initiatives. 

SOUTHWESTERN PENNSYLVANIA JOB LOSSES IN MANUFACTURING

Catalyst Connection has been the MEP of southwestern Pennsylvania since 1994, 

and has achieved significant results. Companies that work with us are hiring, growing, and adding jobs. But we need to do more. Unfortunately, manufacturing employment in our region has decreased by almost 5 percent in the last 5 years, even 

though output and productivity are growing. We believe that a majority of the 4,500 

job losses are coming from plant closures and shutdowns of larger companies, such 

as Aquion Energy and Akers National Roll, but the growth in jobs among smaller 

companies was just not enough to make up for these losses. This is particularly concerning for rural communities where downturns in manufacturing impact rural communities disproportionately to more urban communities. Considering that almost all 

manufacturing-dependent counties in this country are rural, this can have a big impact on people’s lives. Back in our region, at least four counties (Indiana, Lawrence, 

Somerset, and Greene) are considered rural according to the USDA, while many 

other communities within the other counties certainly seem rural. Adding to our 

concerns is that many of the counties in our region are also coal-impacted, making 

things very difficult in some of our communities. 

Advanced Manufacturing Technology and Workforce Development Challenges 

To reverse the trends in job losses in our region and around the country, companies will need to accelerate their pace of growth, greater than any productivity gains 

that they must achieve to remain competitive in global markets. They will have to 

continue to invest in new products, automation and robotics, and in workforce development. 

The technologies of Industry 4.0 are quickly taking shape such that additive manufacturing, big data and analytics, digital manufacturing, Internet of Things (IoT), 

smart manufacturing, and other similar buzz words are becoming commonly used, 

yet few manufacturing leaders truly understand the power of these developments, 

or more importantly the impact that they could have on their businesses. 

And while many companies are growing and interested in hiring, the skills gap 

in manufacturing continues to play a significant role, hampering growth, since many 

companies just can’t find the workers they need to fill critical jobs. According to a 

Deloitte report, The Skills Gap in Manufacturing, 2015 and Beyond, over the next 

decade, nearly 3.5 million manufacturing jobs will likely need to be filled in the 

United States. The skills gap is expected to result in 2 million of those jobs going 

unfilled. 

In southwestern Pennsylvania, the news is similar. According to the Partners4 

Work Workforce Investment Board, 26 percent of the approximately 93,000 manufacturing workers in southwestern Pennsylvania are age 55 or over. This identifies 

the need for 24,000 people to enter into careers in manufacturing over the next 10 

years to backfill impending retirements. This is a daunting challenge for one of our 

most important drivers of regional economic success and could result in many of the 

job openings going unfilled. Similarly, Brookings, in its recently released report Capturing the next economy: Pittsburgh’s rise as a global innovation city, writes that 

‘‘demographic and skills headwinds threaten Pittsburgh’s ability to create the broad 

workforce needed to compete.’’ Brookings notes that this is not a simple issue of supply and demand, or even of addressing the skills gap, as many workforce training 

programs go unfilled. Brookings notes that many ‘‘job seekers don’t see viable pathways to careers in advanced industries, including manufacturing.’’ 

While the Brookings report suggests that there are unemployed and underemployed workers available, a recently released report by the Pennsylvania IRC 

Network, Advanced Manufacturing Technology Survey Interviews Report, 60 percent 

of small and medium manufacturers (SMMs) report that talent was one of their top 

three business challenges. Respondents seem to be concerned both with the lack of 

knowledge and skills due to retirements, as well as a lack of skills needed to support emerging technologies. Companies are being challenged to respond to workforce 

needs to upskill and prepare for new technology. 

THE IMPORTANT ROLE OF CATALYST CONNECTION AND THE MEP PROGRAM

Manufacturing CEOs are looking to external resources such as the MEP program 

and Catalyst Connection to provide valuable business process and technology adoption services right-sized to meet their needs. Our foundational expertise in helping 

31 

companies with strategies focused on product, process, and people are critical to getting ready for new technologies. 

Product services are those that facilitate manufacturer growth through improved 

marketing and sales techniques, new product development, exporting, and internal 

and collaborative innovation. Pennsylvania’s research universities are critical partners for product innovation. Process services are those that reduce operating and 

product costs through the implementation of operational improvements, achievement of quality objectives, successful pursuit of sustainability and energy/materials 

efficiencies, and supply chain optimization. And finally, People-focused services provide assistance in the areas of talent development, training in specialized skills, improvements in hiring, HR management, workforce evaluation, and workforce planning processes. 

The bottom line is that products must be innovative, processes must be efficient 

and globally competitive, while the people must have the skills to program, operate, 

and maintain highly automated equipment. And employers are in need of assistance 

in each of these areas. 

Catalyst Connection is also engaging in regional workforce development strategies 

focused on career awareness and exploration at the middle school and high school 

level, and on Employer-led Apprenticeship programs. Our Middle School Video Contest, ‘‘What’s so Cool About Manufacturing’’ attracts over 400 students, parents, and 

teachers, and begins the process of changing the image of manufacturing. Our high 

school Manufacturing Innovation Challenge allows students to practice their realworld problem-solving skills by matching them with local employers and a business 

challenge. Our Employer-Led Apprenticeship program is focused on helping companies register and implement an apprenticeship program that helps to fill their talent 

pipeline, while giving workers valuable credentials and on-the-job training. Our region’s community colleges are critical partners in our apprenticeship programs. 

Conclusion 

In 2017, Catalyst Connection clients reported almost $130 million of new and retained sales, $8 million of cost savings, $16 million of new investments, and 1,164 

jobs created and retained. Companies value the work we do and tell us that our 

staff’s technical expertise and experience, the cost of our services, the return on investment, and the reputation for results are the main reasons they choose to work 

with us. 

I urge you to continue your support for policies and funding that support our 

country’s small and medium-sized manufacturers, which are critical to our Nation’s 

supply chains, including the Department of Defense, and which provide high-paying 

family-sustaining jobs for millions of American families and contribute to their local 

communities and economies. Workforce development resources, including support for 

apprenticeship programs, are a key factor in closing the skills gap in manufacturing. 

The MEP program, as the only program dedicated to serving our country’s small 

and medium-sized manufacturers, is a critical program, and I would urge you to 

continue to support funding for this program at modestly increased levels. 

Manufacturing businesses create and retain high-paying, family-sustaining jobs 

that are building the foundation for national and regional economic growth. Manufacturing job growth also has a significant ripple effect throughout our entire economy, where many firms will prosper. 

PREPARED STATEMENT OF SCOTT N. PAUL, PRESIDENT, 

ALLIANCE FOR AMERICAN MANUFACTURING

Senator Casey and members of the committee, thank you for the opportunity to 

testify on behalf of the Alliance for American Manufacturing (AAM) at today’s hearing on ‘‘Trade Enforcement and Infrastructure: Safeguarding our Industrial Base 

From Present and Future Challenges.’’ 

The Alliance for American Manufacturing is a non-profit, non-partisan partnership formed in 2007 by some of America’s leading manufacturers and the United 

Steelworkers. Our mission is to strengthen American manufacturing and create new 

private-sector jobs through smart public policies. We believe that an innovative and 

growing manufacturing base is vital to America’s economic and national security, as 

well as to providing good jobs for future generations. AAM achieves its mission 

through research, public education, advocacy, strategic communications, and coaliVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00035 Fmt 6601 Sfmt 6621 R:\DOCS\35941.000 TIM
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1Scott, Robert E. ‘‘Growth in U.S.-China trade deficit between 2001 and 2015 cost 3.4 million 

jobs.’’ Economic Policy Institute, January 31, 2017. Web, May 9, 2017. 2Scott, Robert E. ‘‘U.S.-Korea trade deal resulted in growing trade deficits and more than 

95,000 lost U.S. jobs.’’ Economic Policy Institute, May 5, 2016. Web, May 9, 2017. 3Scott, Robert E. ‘‘Currency Manipulation and the 896,600 U.S. Jobs Lost Due to the U.S.- 

Japan Trade Deficit.’’ Economic Policy Institute, February 4, 2015. Web, May 9, 2017. 4Scott, Robert E. ‘‘Currency Manipulation and the 896,600 U.S. Jobs Lost Due to the U.S.- 

Japan Trade Deficit.’’ Economic Policy Institute, February 4, 2015. Web, May 9, 2017. 5Gosselin, Peter, and Dorning, Mike. ‘‘After Doubts, Economists Find China Kills U.S. Factory 

Jobs.’’ Bloomberg Politics, June 18, 2015. Web, May 9, 2017. 

tion building around the issues that matter most to America’s manufacturers and 

workers. 

Formed in 2007, AAM is proud to have helped call attention to some of the most 

pressing trade issues impacting American manufacturing companies and their workers—including global industrial overcapacity, dumping and subsidies, State-owned 

enterprises, currency manipulation, theft of trade secrets, and the need to better negotiate trade agreements. And, with respect to infrastructure, we have been at the 

forefront of efforts to establish stronger Buy America rules to ensure that our hardearned tax dollars create jobs here at home. 

U.S.-CHINA TRADE DEFICIT IS UNPARALLELED IN ITS MAGNITUDE AND ADVERSE IMPACT

Since Beijing’s 2001 entry into the World Trade Organization (WTO), the U.S. bilateral trade deficit with China has more than quadrupled, from $83 billion in 2001 

to a record $375 billion in 2017. In just 15 years, the impact of the surging U.S.- 

China trade deficit on U.S. companies and American workers has been severe and 

too often overlooked. Our communities have shed more than 54,000 manufacturing 

facilities and we’ve seen our global market share in manufactured exports shrink 

from 14 percent in 2000 to 9 percent in 2013. Altogether, a staggering 3.4 million 

jobs, largely in manufacturing, have been lost because of this massive trade imbalance. Each State and every congressional district in the United States has experienced lost jobs. In Pennsylvania alone, 136,700 jobs were displaced, accounting for 

2.34 percent of the Commonwealth’s workforce. And the losses extend into nearly 

every sector of the economy, ranging from computer and electronic parts to textiles 

and apparel, furniture, steel, aluminum, and other capital-intensive sectors.1

While the China trade deficit is unparalleled both in its magnitude and its adverse impact on our economy, we should not overlook that unfair trade from many 

other countries—even including our allies—has taken its toll: 

• South Korea. It was promised that the U.S.-Korea Free Trade Agreement 

(KORUS) would support 70,000 U.S. jobs and increase exports of American 

goods by $10 to $11 billion. Yet, the U.S. trade deficit with South Korea 

jumped $15.1 billion between 2011 and 2015 (from $13.2 billion to $28.3 billion), resulting in the estimated elimination of more than 95,000 jobs.2 The 

trade agreement hailed as a job creator has not opened new markets for U.S. 

automobiles and other products, as was promised, and demands improvement. 

• Japan. Meanwhile, it has been estimated that the trade deficit with Japan— 

fueled by currency practices—is estimated to have eliminated nearly 900,000 

U.S. jobs as the goods deficit reached $78.3 billion in 2013.3 It has remained 

at unacceptable levels ever since. 

TRADE DEFICIT REDUCTION MATTERS

Trade deficits matter, and there is compelling research showing that reducing 

trade deficits would yield positive outcomes for our economy. For instance, a reduction of the U.S. global trade deficit by between $200 billion and $500 billion each 

year ‘‘could increase overall U.S. GDP by between $288 billion and $720 billion and 

create between 2.3 million and 5.8 million U.S. jobs.’’ 4

To those who have made unfounded claims that the loss of 5 million U.S. manufacturing jobs, or roughly one-third of the total amount, since 2000 was the result 

of increased productivity, and not trade deficits, the data does not support such a 

narrative.5 According to the Economic Policy Institute (EPI), between 2000 and 

2007, 3.6 million manufacturing jobs were lost. Yet, productivity growth declined, 

falling from 4.1 percent per year in the 1990s to 3.7 percent per year. The drop in 

the rate of growth of manufacturing output to 0.5 percent per year is largely the 

result of the rapid growth of the manufacturing trade deficit. Meanwhile, the Great 

Recession and financial crisis was largely responsible for the decline in manufacVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00036 Fmt 6601 Sfmt 6621 R:\DOCS\35941.000 TIM
33 

6 vi Scott, Robert E. ‘‘Manufacturing Job Loss: Trade, Not Productivity, Is the Culprit.’’ Economic Policy Institute, August 11, 2015. Web, May 9, 2015. 

turing output and job loss from 2007 to 2014. Manufacturing trade deficits continued to surge over this period following the Great Recession.6

PROACTIVE TRADE ENFORCEMENT APPROACH IS

NECESSARY TO ELIMINATE TRADE DEFICITS

For too long, our trade policies haven’t been focused on supporting our manufacturing sector but, in many ways, have undermined it. The United States is long 

overdue for a new approach to trade, especially with China. It is both possible and 

desirable to create a trade policy framework to support a resurgent, made in America manufacturing base. 

The United States has considerable economic leverage to shrink our $375-billion 

2017 trade deficit with China. U.S. exports to China account for less than a percent 

of our GDP, our banks hold less than a percent of their assets in China, and multinational companies derive less than 2 percent of their revenue from there. 

Using aggressive trade enforcement to strengthen key U.S. sectors is hardly a 

radical proposition and there is clear precedent in our not too distant past of bold 

leadership and outside the box thinking. President Ronald Reagan adopted a flurry 

of measures to address an uneven playing field with European nations and Japan. 

His administration’s aggressive actions helped revitalize our semiconductor industry 

and the iconic Harley Davidson. The Plaza Accords, which raised the value of currencies in Japan and Europe relative to the dollar, had a positive effect in lowering 

our trade deficits. 

IT’S TIME FOR THE WHITE HOUSE TO COMPLETE

KEY TRADE AND MANUFACTURING ACTIONS

After a year in office, President Trump has repeatedly promised to crack down 

on unfair trade and negotiate reciprocal trade agreements. Yet, on many key issues, 

the administration’s words have resulted in either inaction or confusion as to the 

path forward. A status quo approach means continued persistent trade deficits, lost 

jobs, theft of our innovation base, and the steady erosion of our manufacturing capacity and workforce. 

• Currency Manipulation. The President repeatedly promised to label China a 

currency manipulator. However, China was not listed as a currency manipulator on either of the Treasury Department’s first two Semiannual Reports on 

International Economic and Exchange Rate Policies. 

• Section 232. The President initiated section 232 investigations on steel and 

aluminum imports’ impact on U.S. national security. However, long and unnecessary delays have made matters even worse as imports continue to surge. 

I will discuss this issue later in my testimony. 

• Section 301. The President initiated a section 301 probe into China’s intellectual property abuses, though since the August 2017 announcement there has 

been little movement towards an action that protects American interests. 

• Pipelines. In January 2017, the President called for a plan to require American pipelines to be constructed with American steel. More than a year later, 

there has been no action taken as imports of Oil Country Tubular Goods 

(OCTG)—a key energy product used in oil and gas extraction—were up nearly 

200 percent in 2017. 

RECOMMENDED ACTIONS FOR THE ADMINISTRATION AND CONGRESS

Outlined below are some of the issues AAM believes need to be addressed for the 

United States both to expand trade relationships in the Asia-Pacific region in a 

manner that increases domestic production and to ensure that our markets do not 

become flooded with unfairly traded products. 

• Trade Enforcement. America’s trade enforcement laws are the backbone of 

U.S. trade law and represent that last line of defense for workers facing unfair trade. Strict enforcement is vital to the preservation of a rules-based 

trading system—one in which American workers are not forced to compete 

against the endless resources of a foreign government that props up its staterun companies. Timely enforcement of U.S. trade remedy laws is vital to levVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00037 Fmt 6601 Sfmt 6621 R:\DOCS\35941.000 TIM
34 

7Wong, Edward. ‘‘Greenpeace Links Beijing’s Air Pollution Surge to Steel Factories.’’ New 

York Times, February 16, 2017. Web, May 10, 2017. 

eling the playing field for U.S. companies and American workers impacted by 

unfair trade practices—like dumping and subsidies. While our trade remedy 

laws help mitigate the damage, rarely do they restore all the lost jobs or 

make an impacted community whole again. Significant time and cost—and injury—is required to proceed with a trade enforcement case. In some cases, entire plants must be shut down before relief can be delivered. This makes no 

sense. We must ensure that timely and effective relief from such market distortions is available before plants are forced to close and workers lose their 

jobs. 

We greatly appreciate the leadership and work of this committee in the passage of the Trade Facilitation and Trade Enforcement Act of 2015, which provided new tools to speed trade enforcement and to crack down on evasion of 

existing trade orders. It is simply unfair to U.S. companies and their workers 

for trade remedies to be circumvented—resulting in further harm and larger 

trade deficits. 

• Global Industrial Overcapacity. Many U.S. industrial sectors are suffering 

from unprecedented challenges due to global overcapacity—largely fueled by 

China—which dampens prices and has forced plant closures and massive layoffs. Despite slowing demand in the Chinese market, Beijing continues to 

maintain high levels of production with subsidies and other state support, undermining U.S. companies that compete based on market considerations. In 

fact, a recent report shows that, despite China’s claims of capacity closures 

in 2016, its net steelmaking capacity actually increased.7 China will only respond, and America will only benefit, if there are enforceable mechanisms to 

ensure that Beijing is living up to its commitments. For the past 10 years, 

China has delayed concrete action with lofty promises to cut capacity that 

never materialize. Despite repeated public pronouncements dating back to 

2009 of plans to aggressively cut capacity, China’s steelmaking capacity has 

increased over 400 million metric tons, roughly equivalent to five times the 

total production of the U.S. steel industry in 2016. The G20 Global Forum on 

Steel Excess Capacity cannot be another tool to be used by the Chinese government to delay meaningful change. 

• Maintain China’s Non-Market Economy Status. No one can seriously claim 

that Beijing runs a market economy, but the Chinese government desperately 

wants to be treated that way. Under U.S. law, China is and should continue 

to be treated as a non-market economy (NME). Any change to this status 

would severely undermine America’s trade remedy laws and expose U.S. companies and American workers to more dumped imports. Such changes can 

only be made if China meets six specific criteria demonstrating that market 

forces, and not the government’s party leadership, are directing the economy. 

Presently, China fails to meet the six criteria and it should focus on reforms 

rather than its attempts to shortcut this issue by way of the World Trade Organization (WTO). 

• Cyber-Theft. It is critical that the government provide support when foreign 

interests steal trade secrets to manufacture products abroad and send them 

to the United States. Theft of intellectual property and trade secrets has been 

a serious problem with China. U.S. companies report that Chinese interests 

have not only stolen sensitive trade secrets, but that Chinese firms are now 

commercializing that valuable intellectual property into Chinese products. It 

is outrageous that U.S. companies are being forced to compete against the 

very products that they spent years and significant financial resources to develop. If the available trade enforcement tools—including section 337 of the 

Tariff Act of 1930—do not work as intended, Congress should improve them 

so that our companies are not subjected to dishonest and criminal activity 

without the opportunity to seek effective and timely relief. And, the President 

should swiftly complete his section 301 investigation and take meaningful action to defend domestic companies against foreign theft of intellectual property and technology transfer. 

• State-Owned Companies. China has many state-owned and state-directed enterprises (SOEs) that send dumped and subsidized goods into the U.S. market. In a disturbing trend, China’s SOEs are also now aggressively seeking 

to invest here in America, putting further strain on U.S. firms that make deVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00038 Fmt 6601 Sfmt 6621 R:\DOCS\35941.000 TIM
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8Peterson Institute for International Economics. 

9 ‘‘Steel Imports Up 15 Percent in 2017.’’ American Iron and Steel Institute, January 26, 2018. 

Web, February 12, 2018. 10http://chestertontribune.com/Business/arcelormittal_closing_part_of_pa.htm. 

cisions based on market forces. It is vital that we strengthen our CFIUS system of reviewing foreign acquisitions of strategic U.S. companies and operations so that they do not fall under the control of the Chinese government. 

• Currency Manipulation. China, Japan, South Korea, and other major trading 

partners have a long history of currency manipulation, which contributed to 

the loss of 5 million U.S. jobs.8 Despite claims that the yuan is no longer undervalued, there is ample evidence that Beijing continues to play an active, 

daily role in setting exchange rates. We urge the passage of legislation to 

treat foreign currency manipulation as a subsidy under trade remedy laws. 

And, we support the inclusion of strong, enforceable rules in trade agreements to deter and penalize currency manipulation. We will also be closely 

watching as the administration prepares to release yet another Semiannual 

Report on International Economic and Exchange Rate Policies, due by April 

15th. 

• Automobiles and Rules of Origin in Trade Agreements. A trade agreement’s 

rules of origin determine the national source of a product. This is important 

because only those countries bearing the risks and responsibilities of signing 

an agreement should obtain its benefits. We believe the rule of origin on automobiles in NAFTA and other trade agreements should be strengthened, so 

that workers in signatory countries can enjoy more of the benefits, while 

minimizing the advantages of non-participating countries. In the context of 

the NAFTA negotiations, automobiles and auto parts from countries such as 

Japan, South Korea, and China, all of which heavily protect their own industries, should not be permitted to displace North American production through 

rules of origin that are set too low. As it relates to KORUS, more work must 

be done to open the Korean market—one of the most difficult for our automakers to export into despite the signing of a trade agreement intended to 

open the market. 

IT’S TIME TO ACT ON THE SECTION 232 INVESTIGATION

Last, but certainly not least, I want to focus your attention to the pending section 

232 investigations on the impact of steel and aluminum imports on U.S. national 

security. In April 2017, President Trump directed the Department of Commerce to 

complete these self-initiated investigations under an expedited timeline, saying, 

‘‘Maintaining the production of American steel is extremely important to our national security and our defense industrial base. Steel is critical to both our economy 

and our military. This is not an area where we can afford to become dependent on 

foreign countries.’’ In late-May 2017, the administration said the reports would be 

released in June and, just days later, the President himself publicly said the 232 

reports would be coming ‘‘very soon’’ and that ‘‘we’re going to stop the dumping.’’ 

In early June, President Trump added, ‘‘Wait until you see what I’m going to do 

for steel and for your steel companies. . . . We’re going to stop the dumping, and 

stop all of these wonderful other countries from coming in and killing our companies 

and our workers. You’ll be seeing that very soon. The steel folks are going to be very 

happy.’’ 

Despite those assurances, months passed without a clear understanding of when 

the investigations would be completed. American workers were told that the administration needed to complete tax reform and other legislative priorities before it 

could again focus on the section 232 investigations. All the while, the import problem has been worsening for American workers and U.S. companies. Steel imports 

soared 21 percent in the 3 months after President Trump announced the section 232 

investigation compared to the 3 months before. Overall, total steel imports were up 

15.4 percent in 2017.9

We recently received the painful news that several steel mills in Pennsylvania 

would be reducing operations, including one that produces armor plate for the U.S. 

military and played an important role in supporting the production of armored vehicles to protect our service men and women from IED attacks in Iraq and Afghanistan.10 Meanwhile, the United States is now down to a single manufacturer of the 

steel needed for America’s essential electric grid—grain-oriented electrical steel 

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36 

made—that could damage or destroy this critical infrastructure. Already reduced to 

just one domestic producer of GOES, electrical steel imports increased by 101 percent in 2017. But, it’s not just a China problem. Electrical steel imports from Japan, 

China, and South Korea are up a staggering 156 to 269 percent. Without broad action to prevent the loss of this domestic production capability, the United States 

would be entirely dependent upon foreign suppliers. 

Our national security rests on a healthy industrial base. Domestic production of 

steel and aluminum are vital in the manufacture of America’s military and critical 

infrastructure, including everything from ships and tanks to bridges and energy infrastructure. If domestic manufacturing capabilities deteriorate further, we may be 

forced to rely on countries like China and Russia to supply steel for our military 

and critical infrastructure needs. We cannot let that happen. 

The President now has up to 90 days to determine what precise action to take. 

But, there’s absolutely no reason to take that long. He should take bold action today 

to protect our national security and American jobs. 

AMERICAN-MADE INFRASTRUCTURE INVESTMENT

Federal investment in infrastructure is critical to a well-functioning economy and 

our national competitiveness. U.S. manufacturers benefit from infrastructure investments not just because they generate new demand for steel, but also because an efficient infrastructure network improves their ability to bring goods to market. We 

desperately need to identify solutions to the funding challenges that stand in the 

way of addressing the backlog of repairs to our Nation’s highways, water systems, 

and other critical infrastructure. According to a Duke University report entitled Infrastructure Investment Creates American Jobs, America has 156,000 deficient 

bridges, an investment backlog of $85.9 billion for our Nation’s roads, and $200 billion in lost economic activity annually from inefficient rail transportation. 

Too often the focus of infrastructure has been on ‘‘shovel ready’’ projects, which 

unfortunately has meant that larger projects that are essential to our steel sector 

have not moved forward. A prime example is the Soo Locks system that allows ships 

to move between Lake Superior and the rest of the Great Lakes. The larger of the 

two locks, the Poe Lock, is nearly 50 years old and the only lock that can accommodate larger vessels that make up almost 70 percent of the potential capacity of the 

Great Lakes fleet. A recent report by the Department of Homeland Security found 

that if the Poe lock were to shut down for 6 months, the Nation would experience 

economic hardship as mines and steel mills experienced supply chain disruptions, 

causing a ripple effect throughout the manufacturing sector that could impact as 

many as 11 million workers. Depending on when such a failure occurred, as much 

as 75 percent of U.S. steel output could go offline in a matter of weeks. Building 

a second Poe-sized lock would cost $580 million, but would spur $1.7 billion in economic activity. 

STRONG BUY AMERICA POLICIES CREATE JOBS HERE AT HOME

Buy America policies are procurement preferences for iron, steel, and manufactured goods that are ‘‘produced in the United States.’’ These preferences apply to 

Federal infrastructure programs, ensuring that U.S. companies and American workers have the first opportunity to supply the materials used to build our highways, 

rail, airports, water systems, and other critical infrastructure. Strong Buy America 

laws maximize the return on the Nation’s investment in our infrastructure and are 

consistent with our international obligations. 

I want to offer several recommendations as Congress moves closer to a debate on 

infrastructure: 

• Include Buy America in the infrastructure package. As Congress looks to funding solutions, it is necessary to ensure that new funding mechanisms—including public-private partnerships or other new innovative financing tools—are 

covered with strong Buy America rules. Despite his frequent campaign rhetoric on the issue, we were disappointed to see that President Trump’s recently 

released infrastructure plan made no mention of Buy America. In fact, it goes 

in the completely opposite direction, proposing to weaken existing applications, resulting in tax dollars going overseas to purchase foreign steel for our 

infrastructure needs. 

• Apply Buy America where it doesn’t exist. There are many infrastructure 

spending programs that are not covered by a Buy America preference. We 

support a top-to-bottom review of all infrastructure spending programs and 

37 

enacting Buy America laws where they are absent. An example of this is the 

Drinking Water State Revolving Fund (DWSRF), which is covered by a temporary Buy America provision. Without action to make this provision permanent, our Nation’s drinking water infrastructure investments will be open to 

steel and iron from China and other countries. We cannot let this happen. 

• Close loopholes and improve existing laws. We should also work to close loopholes, strengthen weak agency enforcement, and reduce the number of unnecessary waivers granted. Bipartisan support in recent transportation bills resulted in language to prevent project segmentation and increase transparency 

of the waiver process. 

• Reject efforts to weaken Buy America by supporting the ‘‘Melted and Poured’’ 

standard. For 35 years, the foundation of our Buy America laws has been the 

requirement that all steel manufacturing processes occur in the United States 

for a product to be Buy America compliant—from the actual steel production 

to the finishing processes. Regrettably, a few companies whose business 

model focuses on importing foreign steel are aggressively lobbying to create 

a massive Buy America loophole that would allow steel from Russia, China, 

or other foreign sources to qualify as ‘‘produced in the United States.’’ This 

massive outsourcing loophole should be rejected outright. Steel is made here 

only if it is melted here. 

NO MORE OUTSOURCED INFRASTRUCTURE PROJECTS

I want to highlight several high-profile infrastructure projects that have found 

ways to evade Federal Buy America laws. In each case, public resources bypassed 

U.S. companies and American workers and, instead, supported jobs in China and 

other foreign countries. 

• San Francisco-Oakland Bay Bridge. Completed in 2013, California State officials used clever accounting gimmicks to bypass Federal Buy America laws 

for the construction of the Bay Bridge. They thought that using Chinese steel 

would net them $400 million in savings to the overall project. Rather, the 

project was plagued with quality issues and cost overruns, all while thousands of jobs were created in China instead of here in the United States. The 

project was a decade behind schedule and nearly $4 billion over budget. 

• Verrazano-Narrows Bridge. In 2013, New York State officials decided to 

source 15,000 tons of steel, including the fabrication work, from China for the 

bridge deck replacement at the Verrazano-Narrows Bridge. In shocking fashion, the Metropolitan Transportation Authority (MTA) awarded the contract 

to a Chinese state-owned company that had never done such work. MTA used 

a very specific fabrication design, called orthotropic decking, and used it as 

an excuse to bypass U.S. companies and workers ready to rebuild the bridge. 

• LaGuardia Airport. Early last year, it was reported that Chinese and other 

foreign-origin steel is being used in the $4-billion LaGuardia Airport renovation. While the project does not appear to be covered by a Federal Buy America law, it is notable that the Port Authority of NY and NJ has received $76 

million in Federal FAA grants for improvements at LaGuardia in just the last 

10 years. These funds require U.S.-melted steel to be used. And, the Port Authority will finance the LaGuardia project with $1 billion in Passenger Facility Charges (PFCs). 

CONCLUSION

Thank you for the opportunity to testify today. We look forward to working with 

you to advance policies that will revitalize America’s manufacturing sector—a major 

economic driver, foundation of U.S. national security, and source for millions of 

family-sustaining jobs. Together, we can Keep It Made in America. 

PREPARED STATEMENT OF TODD YOUNG, MANAGING DIRECTOR, 

GOVERNMENT AFFAIRS, UNITED STATES STEEL CORPORATION

Thank you for conducting today’s hearing in western Pennsylvania and inviting 

testimony from United States Steel Corporation, which is proudly headquartered in 

Pittsburgh, still known far and wide as The Steel City. Senator Casey’s leadership 

in convening this forum on trade law enforcement and improving America’s infraVerDate Sep 11 2014 15:53 Apr 11, 2019 Jkt 000000 PO 00000 Frm 00041 Fmt 6601 Sfmt 6621 R:\DOCS\35941.000 TIM
38 

1 Hot rolled—Australia, Brazil, Japan, Korea, Netherlands, Turkey, and UK; cold-rolled— 

Brazil, China, India, Korea, Netherlands, and UK (∗negative on Russia); and corrosionresistant—China, India, Italy, Korea, and Taiwan. 

structure is very much appreciated. Both of these topics are public policy priorities 

for America’s steelmakers. 

U.S. Steel was founded in 1901 and is the largest integrated steel producer 

headquartered in the United States, with domestic annual raw steelmaking capability of 17 million net tons. U.S. Steel manufactures semi-finished steel as well as 

a wide range of value-added flat-rolled and tubular products for the automotive, appliance, container, industrial machinery, construction, and oil and gas industries. 

Our major domestic steel operations are located in the Commonwealth of Pennsylvania, home to our Mon Valley Works, compromised of the Edgar Thomson, Irvin 

and Clairton plants east of Pittsburgh, and the Fairless Plant near Philadelphia; in 

the State of Indiana, with our Gary Works in Gary, our Midwest Plant in Portage, 

and tin operations in East Chicago; in the State of Michigan, with our Great Lakes 

Works located in Ecorse and River Rouge near Detroit; and in the State of Illinois, 

at our Granite City Works east of St. Louis, MO. Our tubular operations are located 

in: Fairfield, AL; Lorain, OH; Pine Bluff, AR; and multiple locations near Houston, 

TX. Our two iron ore operations in Minnesota are located in Mt. Iron and Keewatin. 

These mines supply iron ore pellets to all our steelmaking operations, as well as 

to third parties. U.S. Steel is also involved in several steel finishing joint ventures 

in the United States. 

U.S. Steel is a leader in both process and product technology and has three domestic research and development facilities dedicated to advancing the boundaries of 

steelmaking: the Research and Technology Center in Munhall, PA; the Automotive 

Center, a research and sales facility in Troy, MI; and the U.S. Steel Tubular Products Innovation and Technology Center in Houston, TX. 

TRADE ENFORCEMENT

Over the past several years, America’s steel companies and workers have been 

challenged by significant, persistent unfairly traded imports flooding our markets. 

Steel at dumped prices and subsidized by foreign governments targets our open 

markets. As a result, many American steel-making facilities have been forced to 

shutdown temporarily or even permanently causing thousands of hard-working, 

highly skilled Americans to lose their jobs. American steel companies can compete 

and win against any other producers around the world on a level playing field—yet 

that requires fair enforcement of our trade laws and strong, prompt action by the 

Federal Government. 

We commend Congress on passing the 2015 Leveling the Playing Field Act, which 

significantly strengthened U.S. trade remedy law by clarifying the injury standard 

for the International Trade Commission in antidumping and countervailing duty— 

or AD/CVD—cases and providing the Commerce Department with additional tools 

to address dumped and subsidized imports. This strengthening of the trade law was 

the result of forceful, bipartisan leadership by steel champions in both the House 

and Senate. 

Passed by Congress a few months later yet effectively in tandem with the Level 

the Playing Field Act, we applauded enactment of the 2016 Trade Facilitation and 

Trade Enforcement Act, especially the Enforce and Protect Act contained therein 

which provided U.S. Customs with new tools and directives to aggressively enforce 

U.S. trade remedy orders and crack down on duty evasion and customs fraud. It was 

critical that this second law followed as AD/CVD orders only level the playing field 

if they are strictly and effectively enforced. 

U.S. Steel and other domestic producers moved swiftly in utilizing these new laws 

by filing a series of new AD/CVD petitions on a flood of unfairly traded imports of 

hot-rolled, cold-rolled, and corrosion-resistant steel from 12 countries in the summer 

of 2015. Solely through subsidies and rock-bottom prices—many times below the 

cost of production—these imports captured significant U.S. market share at the direct expense of American steel mills and workers. As a result of those investigations, however, and due in large part to the new laws, the domestic steel industry 

was able to obtain 28 new AD/CVD orders on 11 countries,1 many with commercially meaningful duties. This provided U.S. Steel and American producers with critical relief. 

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Though these recent flat-rolled orders stemmed the tide of unfairly traded imports 

from the targeted countries, an all-too-familiar story unfolded—low-priced imports 

surged in from other countries not covered by U.S. AD/CVD orders. 

For example, even before the orders were in place, imports of cold-rolled and 

corrosion-resistant steel from Vietnam replaced imports from China nearly ton-forton. As a result, U.S. Steel and other domestic producers filed circumvention petitions with the Commerce Department in September 2016, arguing that U.S. imports 

of Chinese steel finished in Vietnam should be covered by the AD/CVD orders on 

imports from China. The Commerce Department’s December 2017 preliminary affirmative circumvention finding represents a critical step toward shutting down one 

of the many paths used to flood the U.S. with dumped and subsidized steel. This 

decision is an encouraging sign for the steel industry and should put other countries 

and foreign producers on notice that circumvention will no longer be tolerated. 

The job is far from done, however. Our trade laws simply take too long to provide 

relief from unfairly traded imports, and by the time relief often comes, foreign steel 

companies have moved locations and/or devised sophisticated plans to evade or circumvent any relief. 

For example, in 2014 we obtained AD/CVD orders on oil country tubular goods— 

or OCTG—from Korea and have obtained higher and higher AD duty rates in each 

administrative review. Dumped OCTG imports from Korea, however, have continued 

to surge into our market due to, among other things, subsidized steel and electricity 

and Korean government-directed reimbursement of AD duties. These practices not 

only thwart the remedial purpose of U.S. antidumping law, but they also threaten 

the U.S. OCTG industry, which is integral for the development of U.S. energy resources and infrastructure (including petroleum refineries, oil and gas pipelines, offshort rigs, and storage tanks). America cannot achieve national energy security and 

independence if our ability to harness our own abundant resources becomes reliant 

on foreign steel from unstable regions of the world. 

In addition to the reliance on American steel of critical infrastructure and energy 

independence, the U.S. military relies on steel to protect our troops in conventional 

and unconventional wars, from armor for tanks, ships, and submarines to engines, 

gears, bearings, and bodies of the F–35 Joint Strike Fighter and other aircraft. 

When called upon during World War II, U.S. Steel produced, among other things, 

90 percent of the steel used to make over 21 million helmets. And we invented the 

landing mat, to project our airpower wherever and whenever required. Today, U.S. 

Steel produces the hot-rolled steel that Stupp Corporation uses to produce Mk82, 

Mk83, and Mk84 bomb bodies for the Department of Defense. 

Our national security is only as strong as our country’s ability to produce steel 

from beginning to end within our Nation. That is why we urge President Trump to 

complete the section 232 national security investigation of steel imports initiated 

last April. The unrelenting and growing barrage of unfairly traded steel entering 

our market leaves no doubt that imports are threatening our national security. The 

law provides the President with broad power to implement remedies under section 

232, and we believe the threat posed to America’s steelmaking capacity merits aggressive action by President Trump. The needed remedy must be comprehensive and 

broad-based, covering the full range of steel products—including semi-finished products such as slab—and all producing countries, with only limited exceptions for 

products not currently available in the United States. Comprehensive section 232 

remedies would allow American steel producers to restart idled capacity, rehire 

thousands of steelworkers, and significantly strengthen our economy, steel industrial base, and national security. 

Significant progress has been made on strengthening trade enforcement and utilizing new and little-used enforcement tools. We look forward to continuing to work 

with Congress and the administration to further strengthen U.S. trade law enforcement so that no more American steel mills are shuttered, no more American steelworkers are laid off, and the American steel industrial base and national security 

are no longer threatened by unfairly traded imports or foreign governments. 

INFRASTRUCTURE

For a steel maker, investment in infrastructure is both a necessity and an opportunity. Efficient, reliable transportation directly impacts both our ability to move 

millions of tons of raw materials and finished product, and our overall competitiveness as a company and industry. Long-term investment to improve our transportation, water, energy, and other critical infrastructure also creates direct demand 

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for steel and enables broad economic growth and job creation that further drives 

steel demand in more consumer-oriented markets like appliances, cars and trucks, 

and more. 

As the national discussion on how best to invest in infrastructure advances, we 

encourage a focus on three priorities: increased, long-term investment; project 

streamlining; and maintaining the commitment to Buy America. Long-term funding 

is essential to undertaking the large-scale projects needed to modernize and expand 

our transportation infrastructure. In addition, responsible regulatory reform that 

significantly shortens the permitting and approval process for project delivery will 

lower costs and deliver results sooner to system users. As we invest in America, 

there must also be an expanded commitment to the long-standing principle that the 

iron and steel used to rebuild our Nation’s infrastructure should be produced—melted and poured—in the United States. 

We sincerely appreciate the opportunity to join today’s hearing and to provide perspective to the subcommittee on two priorities of fundamental importance to U.S. 

Steel and our country. We stand ready to support and assist your important work. 

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