PUNISHING STEEL CONSUMERS.

Our President is still making noises about protecting domestic steel production.  Via Cafe Hayek, here is George Mason's Dan Griswold, making the case to The Wall Street Journal that protecting steel jobs comes at the expense of other jobs, among people who build the products that use the more expensive steel, and among people who build the products that consumers might buy with less of their disposable income going into steel-using products.

Professor Griswold notes that raw steel production in the United States is currently around eighty million tons a year; that is a substantial decrease from the hundred-plus million tons of the early 1970s (Approximately 104 million tons, or seventeen efficient-scale integrated steel works, in 1972.)

That change reflects, in part, the ability of steel consumers to build their products stronger and lighter.  The employment declines reflect, in part, the ability of steel producers to produce more steel with fewer workers (and there is no way for the entire work-force of the United States to produce eighty million tons of steel with late nineteenth-century technology).

But I still fear that Our President will be swayed by the blandishment of the domestic-content advocates.  Their schtick used to be that it wasn't enough to protect domestic steel production: to the extent that imported automobiles or imported refrigerators or imported computer towers sourced their steel overseas, it was both steel workers and consumer durables workers being put out of work.  Put another way, a domestic content policy supports the rights of U.S. consumers to pay higher prices for a smaller set of goods.