Posted on 12/30/2009 11:33:06 AM PST by UAConservative
What good are details? /s
At Spring Engineering and Manufacturing Corp., a Canton, Mich.-based supplier of precision components to the auto industry, steel costs have risen 27% overall since the tariffs were imposed although smaller orders for some types of steel have increased by as much as 90%, according to vice president and general manager Dan Blatt.I really wish people would stop claiming that there is such thing as a free lunch. If they point to the jobs saved, they should point to the jobs lost. "Free-traders" are asked to do it all the time.For 2002 the higher costs resulted in an additional 4% loss, on top of an already unprofitable year. The price hikes have also prompted no fewer than 280 cost-cutting measures including reducing the workforce from 102 to 85, prolonging a wage freeze -- now 18 months old -- and even eliminating free coffee for remaining workers. Executives have taken a 10% pay cut.
Spring's capital budget has been slashed to $500,000 from $1.2 million, eroding its ability to invest in new plant and equipment that would enable it to break into new markets. "This has depleted our ability to fund growth and left us bidding [only] on jobs that we already have the equipment for," says Blatt. "It's a long-term slow-death spiral."
Sourcing steel offshore isn't an option, Blatt adds, because of the tariffs which apply to 90% of the metal the company buys. He says he's read through all 728 exclusions to the tariff regime and none apply to him. And even if he found a loophole, Spring simply doesn't order enough steel to attract a competitive price from a foreign supplier.
Blatt also contends with suppliers whose reliability is diminished by the financial strictures of bankruptcy. So he has just signed on with two new suppliers in return for agreeing to pay an extra 6% on top of the existing 27% rise.
His efforts to pass the higher costs on to clients have had some success. Of 12 customers who were recently asked to pay more, seven agreed to "help" while five took their business elsewhere. In light of that, Blatt decided not to approach the company's remaining 18 customers because the risks of losing the business were too great.
Would he ever consider moving the company overseas to avoid the tariffs? Only when all other options fail, he says, because it "would leave 85 families without a wage earner."
Meanwhile, bigger steel users such as the automobile industry have been less affected by the higher steel prices for two reasons: They have long-term contracts with steelmakers and a greater ability to dictate terms with component suppliers because of their size.
University of Pennsylvania, U.S. Steel Users Claim Tariffs 'Protect a Few at the Expense of the Majority', February 12, 2003.
Yep, and stroke the steelworker's unions.
And fuel. Don't forget fuel, because one fifth of the cost of a well is for the casing and production tubing.
Another fifth is in drilling costs, and you aren't going to get that any cheaper when drill strings start parting because the pipe cannot be replaced, or the cost to do so is much higher.
So the predictable result is an increase in the cost of fuel, be it oil, diesel, gasoline, or natural gas.
It seems like 0bowdown isn’t satisfied with opening up America’s arteries to bleed us out he intends to open every vein and capillary no matter how small.
Yep. That's what the "health care" thing is about--forcing the penny stinkers to pony up more dough for insurance (not actual "care") to clean out the piggy banks. They'll loot until we throw them out, one way or another.
All the turnips will be anemic before this is over.
None of the 'usual' suspects there, are there?
Just to be clear, when the government does something that raises prices and costs jobs, a free trader said that where exactly?
Happy New Year! Be sure to ping me with that info. Thanks!
Everything I predicted, including a socialist in the White House has come true ... thanks to our so called 'free trade' policies.
But the main thing is the Wal-Mart crowd can get XXXXL panties for their old lady ;^)
And you have a great New Year too!
Yeah, right. LOL!
You skipped a few steps there sparky.
Maybe next year you'll use that wayback machine to prove something, anything, about what you imagined I posted in the past.
So you are flat out denying that you ever said, (in words to the effect) that “Free Trade” has increased home ownership amongst Americans? Never posted any articles or the like to such a effect?
And for the record, you denied/ were unaware - we were in a war with Red China?
I remember seeing an episode of MASH that mentioned something about Chinese troops.
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