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Why Steel Is Important for National Security

By Camille Grayson
on August 5, 2019

When the U.S. government placed a 25% tariff on steel imports last year, it cited reasons of national security. Some assumed the measure was necessary so America wouldn’t have to use foreign steel to produce military vehicles and weapons, but the concern was really much broader. The Secretary of Commerce clarified that national security includes the “general security and welfare of certain industries, beyond those necessary to satisfy national defense requirements, which are critical to minimum operations of the economy and government.” In other words, the security of our steel industry is key to the security of our nation as a whole.

The Threat of Imported Steel

Before the tariff was implemented, American manufacturers were using imported steel excessively. As a result, the capacity utilization rate of domestic steel mills had fallen below 80% — the minimum level needed for the industry to progress and profit. If the utilization rate had remained low, more steel mills would have been forced to shut down, leaving America without enough mills to leverage if we ever found ourselves in sudden need of domestic steel for infrastructure, construction or defense purposes (to manufacture weapons, vehicles and countless other related items).

Tariffs to the Rescue

Fortunately, the tariffs have brought the capacity utilization of American steel mills back up above the 80% threshold. We’ve seen significant growth in the industry, and we’re now in a position where we can draw upon our steel mills to meet our nation’s needs instead of relying on imports. That’s real security — for the steel industry and the nation.