September 15, 2009

I agree with Leo Gerard. This is at least a step in the right direction with our trade laws.

SCHULTZ: Welcome back to THE ED SHOW. Tomorrow, President Obama will head to Pittsburgh to speak to union leaders at the annual AFL-CIO conference. Labor is fired up. I was there last night, had a radio town hall meeting. They‘re expecting a lot from President Obama.

The union‘s got a big victory from the Obama White House over the weekend, when the president agreed to impose temporary tariffs on tires imported from China. Union leaders say cheap Chinese tires have cost American jobs and shut down plants, and putting an import tax on them will level the playing field for American workers.

Joining me now is Leo Gerard, president of the United Steelworkers International. Mr. Gerard, good to have you with us tonight. How bold a move was this by President Obama to go ahead and uphold the U.S. International Trade Commission‘s ruling on this? This is something the Bush administration did not do. How bold is this in your opinion?

LEO GERARD, UNITED STEELWORKERS INTERNATIONAL PRESIDENT: I think it was a very important step, very important move. In fact, this is the first time a president has brought meaning for sanctions against a foreign—a foreign country since Ronald Reagan. Ronald Reagan did it twice. So I‘m pleased that President Obama stepped in.

We believe that this is a rule-base country. We went to the International Trade Commission and said, China‘s breaking the rules. They agreed. Now President Obama‘s agreed. I‘m very pleased.

SCHULTZ: John Harwood of CNBC had an exclusive interview with President Obama today and asked him about this ruling and trade agreements. Here‘s his response.


OBAMA: I just want to make sure if we actually have rules written down, they mean something. The next time I go to the American people or to Congress, saying this trade agreement is good for America, people have to have confidence that these words are going to mean something.


SCHULTZ: Mr. Gerard, what does this signal to the Chinese? Is this a new day dawning on how we‘re going to deal with China, after we owe them a boat load of money? If it wasn‘t for their help, I don‘t know if our economy would be floating right now. What do you make of this?

SCHULTZ: I want to take a little license, I guess, with what you said. We owe them a boat load of money because we‘ve been sending them our jobs. And they‘ve been sending us their products. We‘ve been exporting jobs and importing products. That‘s the wrong approach. I think what President Obama has said is that he‘s now going to look at making sure that the rules of international trade are going to be followed.

I‘m very confident that what we ought to be doing now is using this opportunity to work with leadership in the Congress to talk about a new kind of trade pattern that we would take. We owe China trillions of dollars, but that‘s because we‘ve been running 300 and 400 billion dollar a year trade deficits for the last six, seven years.

If the president says we‘re going to have a rules-based system, I think then we have a look at how do we change the rules so that the rules favor American workers, so that we can export products and not jobs.

SCHULTZ: Do you think we can create jobs and the manufacturing sector in America with the trade agreements we have right now?

GERARD: I think the trade agreements we have now, Ed, are really knocking the manufacturing industry flat on its butt. Recently, China said it was going to have a stimulus program, and that every product that was going to get bought in the stimulus program had to be made in China. Just a couple of weeks ago, they said that they want to be the export platform for renewable energy.

Just this week, they said they want to be the export platform for photovoltaic cells and wind turbines. If we‘re going to try to have renewable energy so that we‘re not going to be prisoners of foreign oil, but we have to import wind turbines and photovoltaic cells from China, then that‘s not going to be much different.

I believe, given a level playing field, that American workers can compete with anybody and everybody.

SCHULTZ: Now, China is not taking this well. Beijing has responded. They don‘t like the move that the president, what he‘s done with the tariffs. Did you get the tariffs you wanted on tires? Or was it a lower number?

GERARD: The tariff that the president sanctioned is a much lower number than we asked for. It‘s a much lower number than the International Trade Commission approved. But they used a different set of facts because they were able to look three and four and five months into the year, where we weren‘t. They think these tariffs will be relatively equivalent to what the ITC said. We accept them at their word. We‘re going to monitor that.

Let me say a word about China. China is blustering and trying to bully. They ought to stop that. They sent an army of folks over here to try and intimidate us, to try and push us around. The fact of the matter is these are the rules China agreed to when they entered the World Trading Organization. When they entered the World Trading Organization, they said these are the rules we‘re willing to play by. We went to the International Trade Commission, which in my view is the Supreme Court of trade in this country; we demonstrated unequivocally that they broke the rules.

SCHULTZ: That they cheat.

GERARD: That they cheated, that they broke the rules. They surged in violation of what they said they would do. Now for them to bluster and to bring about threats, that also is a violation of the World Trade Organization. So I don‘t take them too seriously. We‘re a rules-based society and we follow the rules.

SCHULTZ: President of the United International Steelworkers, Mr. Leo Gerard, thanks for your time tonight on this subject. We‘ll visit again.

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