The United States averted a major global war Thursday.
Weapons of mass destruction and the threat of terrorism were not
to blame for this war. This war would have pitted America against
Europe, China and Japan, to name a few.
It wasn’t going to be fought in the name of patriotism or for
democracy. The major global war the United States avoided this week
was over citrus oranges and steel… a trade war.
President Bush decided Thursday to lift the steel tariff he
imposed in March of 2002. This decision to allow foreign steel to
enter the U.S. market tariff-free will most certainly have a
negative political effect for his re-election bid next year with
voters in the Rust Belt states, including steel-producing states
Pennsylvania, West Virginia and Ohio.
By placing a tariff on foreign steel, the administration ensured
domestic steel prices would remain inflated.
The tariff stopped steel-producing countries like China and
Japan from flooding the U.S. market with cheaper steel and
effectively allowed domestic steel companies to survive.
This was good news for the Rust Belt in 2002 because its economy
is largely based upon steel production so it helped Bush
politically. It also hurt him politically in states that buy steel
for industry and manufacturing purposes, namely Michigan, where
automakers and automobile parts factories are huge players in state
On the international level, it was seen as a break of good faith
to the countries within the World Trade Organization, which is
where the European Union and its allies against America enter.
The WTO established a free trade network among countries within
its ranks. But because companies in China and Japan produce steel
for a relatively cheaper price than U.S. companies, the American
steel industry lobbied heavily for the steel tariff to stay in
This March a three-judge panel in the WTO voted against the U.S.
tariffs, ruling they broke international trade rules by not fairly
allowing the free trade of steel with other countries.
In response, the EU threatened the United States with $2.2
billion in tariffs of its own against exported U.S. products. This
is where the trade war, or war of tariffs on each other’s exported
goods, began to emerge.
It became worse politically for Bush when the EU attached
tariffs to citrus oranges, a huge moneymaker for Florida’s economy,
and textiles, a huge moneymaker in the Carolinas. This is how the
EU, China and Japan pushed President Bush into a corner,
Bush won Ohio and West Virginia, two traditionally Democratic
and steel-producing states in 2000. He lost Michigan, a
steel-purchasing state, and needs to win the Carolinas and Florida
badly in 2004.
Bush didn’t want to have to explain to voters in politically
critical states that he felt the steel industry’s sustainability
was worth the lost revenue their states would incur from the
tariffs the EU was threatening to put on exported goods.
And, because the Steel Workers of America have backed
presidential hopeful Sen. Richard Gephart (D-Missouri), the
decision to protect textiles and citrus oranges over steel was an
easy one to make. Not to mention, by dropping the steel tariff Bush
gained political support in Michigan.
What is surprising about this entire political soap opera is the
power the EU has on the world politics stage. After the formation
of the EU, the United States is no longer alone as the only major
superpower in the world.
Yes, it is true the EU is still in need of much growth before it
can rise to the level of military prowess of the United States. But
the fact it can sandbag trade decisions in the United States and
dictate foreign policy resolutions is an important demonstration of
its power that people shouldn’t ignore.
Since the 1988 fall of the Soviet Union, the United States has
enjoyed a ride as the only world power in forming international
policy. It is in the forefront of NATO, the U.N., the WTO and many
other international agencies and agreements over the past 60 years.
But America is no longer the only power leading the way.
America’s entrance into the WTO, compiled with many other
binding international agreements, has made its ability to be a
unilateral, independent nation impossible. Despite the rhetoric of
many government officials on both sides of the aisle, the United
States is more dependant upon the other nations of the world than
So the next time you hear someone say “we don’t need their
support, we’re America,” about another country or region, just
remember how citrus oranges and steel changed world trade policy
and the lives of many Americans this week.
Jason is a senior journalism major. He would like to dedicate
this column to his brother Brian J. Kosena.