President Donald Trump celebrated Steel Dynamics’ plans to build a new mill in the U.S. Wednesday—a feat likely made possible by the White House’s 25 percent import tax on steel implemented this spring.
The steel producer announced earlier this week that it plans to invest up to $1.8 billion in creating a new mill with an annual production capacity of 450,000 tons, Fox Business reports. The new steel mill, set to begin production in 2020, could create work for 600 people.
“Steel JOBS are coming back to America, just like I predicted,” Trump tweeted on Wednesday.
Steel Dynamics announced that it will build a brand new 3 million ton steel mill in the Southwest that will create 600 good-paying U.S. JOBS. Steel JOBS are coming back to America, just like I predicted. Congratulations to Steel Dynamics!
— Donald J. Trump (@realDonaldTrump) November 28, 2018
What the president may have not foreseen is the flip side to his tariffs: this same tax that benefited producers like Steel Dynamics contributed to General Motors’additional costs of $1 billion this year, largely due to heightened production costs.
This potentially strengthened GM’s recent decision to slash its workforce by 15 percent and halt production at five U.S. plants—a move lambasted by the president.
GM had warned the Trump administration back in June that its steel tariffs could lead to “less investment, fewer jobs, and lower wages” in the American auto industry.
“The carry-on effect of less investment and a smaller workforce could delay breakthrough technologies and threaten U.S. leadership in the next generation of automotive technology,” GM said in comments submitted to the Commerce Department at the time.
The Trump administration moved forward with the tariffs despite the warnings, enacting a 25 percent tax on all imported steel and 10 percent tax on aluminum earlier this year.
While the tariffs may have aided American steelworkers like Steel Dynamics by increasing the costs of foreign materials, companies that relied on that steel are forced to swallow the costs—GM included.
