It would be easy to write off 2007 as an unproductive year for the steel industry's legislative agenda, given that it never got its trade law bill introduced while an emissions cap-and-trade bill it hates is gaining steam.
But steel industry lobbyists aren't hanging their heads. To the contrary, most are pleased with the progress they made in 2007 and are positively upbeat in their outlook for 2008.
"We're very optimistic about (2008)," one top industry lobbyist said. "Much progress was made in building support for our trade agenda. There has been recognition on the part of new members and senior members of Congress on the need to address China. We feel very good about the goodwill we've built (in 2007) and the prospect of moving the ball forward (in 2008)."
Trade policy remains the overriding issue for the steel community. It's also the area in which most steel industry lobbyists feel they made the most progress in 2007. Capitol Hill insiders have been waiting patiently for Rep. Charles B. Rangel (D., N.Y.), chairman of the powerful House Ways and Means Committee, and Rep. Sander Levin (D., Mich.), chairman of the subcommittee on trade, to introduce a trade enforcement bill. So far nothing. But expectations are for change in 2008. If and when it is introduced, the bill is expected to include several components favored by the steel industry, including a statutory change clarifying that countervailing duties can be applied to non-market economies like China and a guarantee that the United States can continue to use zeroing when calculating anti-dumping duties.
"Something will pass in 2008, even if only for political reasons," one trade lawyer said about a potential trade bill. "If the Democrats don't pass anything, they'll be endangering many of their freshman members in the House. For a quarter of them, trade issues were the reason they were elected and the leadership knows they have to do something."
The controversy over the value of the yuan is an issue that seems as old as money itself. The year was particularly frustrating for those in favor of penalizing Chinese imports for the country's alleged manipulation of the yuan. A widely accepted theory is that the Chinese keep the yuan artificially low by buying up foreign currencies, thereby greasing their export-oriented economy while making imports more expensive to Chinese consumers.
It's worth noting that 2007 was the first time since the 1990s that Democrats—considered by and large more sympathetic to the cause, although plenty of Republicans also are supportive—had control over powerful Senate committees where bills related to the currency issue would be hammered out. The problem? Too many committees wanted control and infighting turned to gridlock.
Sen. Max Baucus (D., Mont.), chairman of the Senate Finance Committee, and Sen. Christopher Dodd (D., Conn.), chairman of the Senate Banking Committee, continued to fight over which committee should have jurisdiction over the issue. Both sides marked up their bills and were said to be working out compromise legislation that would penalize imports in some way. That could enjoy wide congressional support, even though it's likely to meet resistance from the Bush administration.
On the House side, the long-suffering Ryan-Hunter bill has amassed more than 100 signatures, but despite positive remarks about the bill Rangel hasn't yet moved it forward. "He's said supportive things about it, so it could be expected that that could move on its own or be folded into a larger trade enforcement bill," one lobbyist said.
It's hard to say what's going to happen with the cap-and-trade bill introduced by Sen. John Warner (R., Va.) and Sen. Joseph Lieberman (D., Conn.), but most industry lobbyists agree the smart money is on the bill not passing in 2008. There are several reasons. First and foremost, Senate Democrats would need to break a promised filibuster by Sen. James Inhofe (R., Okla.), a global warming skeptic. It's unlikely they'll have the votes to do so. Even if they did, the Democrats might want to wait until after the 2008 presidential election, when they expect a Democrat to be sitting in the Oval Office.
"Without President Bush taking any firm leadership on this issue, it's hard to imagine any real progress," one source said. "At the end of the day, 2007 and 2008 may be seen as the years when the basis for the legislation is set out. The Democrats may want to keep it as a 2009 issue."
The steel industry, meanwhile, remains opposed to the legislation, even after major U.S. aluminum companies expressed their support. The American Iron and Steel Institute testified before Congress that while the industry wasn't saying the door was completely shut on the idea of a cap-and-trade program, it is unimpressed with provisions in the bill designed to help industry and protect it from injurious imports.
A markup is expected to be a monumental process, with a flurry of amendments being offered to the already complex legislation.
Separately, Rep. John D. Dingell (D., Mich.), chairman of the House Energy and Commerce Committee, has circulated a white paper talking about what a cap-and-trade program might look like and has promised more. "We've not seen anything since . . . but we should expect a climate approach, whether it's cap-and-trade or something else, early in 2008," one lobbyist said.