Newsweek is the home base of a left wing journalist (and I use the term in its most broad form) named Kurt Eichenwald. Other than being seemingly goofy, his stock in trade is flogging left wing talking points. Eichenwald, if you recall, is the guy who claimed the Clinton Foundation was a paragon of virtue and lied about the existence of the Foundation’s tax returns showing that it spends rather less than 10% of its take on actual projects. The rest goes to subsidizing the Clinton family and their friends and associates.
Today he breaks a new story. It seems that Donald Trump tried to minimize construction costs:
Plenty of blue-collar workers believe that, as president, Donald Trump would be ready to fight off U.S. trade adversaries and reinvigorate the country’s manufacturing industries through his commitment to the Rust Belt. What they likely don’t know is that Trump has been stiffing American steel workers on his own construction projects for years, choosing to deprive untold millions of dollars from four key electoral swing states and instead directing it to China—the country whose trade practices have helped decimate the once-powerful industrial center of the United States.
A Newsweek investigation has found that in at least two of Trump’s last three construction projects, Trump opted to purchase his steel and aluminum from Chinese manufacturers rather than United States corporations based in states like Pennsylvania, Ohio, Michigan and Wisconsin. In other instances, he abandoned steel altogether, instead choosing the far-less-expensive option of buying concrete from various companies, including some linked to the Luchese and Genovese crime families. Trump has never been accused of engaging in any wrongdoing for his business dealings with those companies, but it’s true that the Mafia has long controlled much of the concrete industry in New York.
Well, smack my ass and call be Sally. A guy in the construction business minimized the cost of materials. The next thing you know, we’ll be told he tried to minimize labor costs. I am heartbroken and gobsmacked. It is a good thing that Eichenwald didn’t see this chart or he would have blamed Trump for the trough in 2008-09
I’d be the last guy to defend China’s steel export policy. They dump steel because the factories are state owned and the jobs they provide to the regime are more important than turning a profit. Chinese steel has been under anti-dumping duties for a while. Right now the tariff on Chinese steel ranges from 266% to 450% depending upon the product. But there are also other considerations. Chinese construction steel arrives in rather uniform shapes. The fabrication of beams, etc., is done by US workers (full disclosure, I worked as a welder in a shop that fabricated beams for highway bridges from steel plates, some of those might well have been of Chinese origin). All of the concrete work is done by US workers — except when Trump was employing Polish illegals, but Eichenwald doesn’t have anything to say about illegal aliens working construction. But, even if Trump had demanded that his buildings be free of all Chinese influence, odds are he would have bought steel from another low-cost producer because minimizing costs is the only way you keep from losing your ass in construction work.
But Chinese dumping is, like all dumping, doomed to failure because you can’t give away enough of your product to turn a profit, or, in the words of the old B-school maxim, you can’t lose a little in each transaction and make up the difference in volume.
Trump has not committed any crimes by purchasing his steel and aluminum from China, nor did he engage in wrongdoing by using Chinese textile factories to make his clothing lines. But, given the only beneficiaries of his decisions to go with cheaper Chinese metals for his construction project are Trump and his family, he is not someone who ever attempted to lead by example by only buying products made in America. He filled his bank accounts with millions of dollars that could have gone to blue-collar workers, many of whom now believe he is the man who will bring back the jobs that he secretly helped to destroy, (Nothing says quality writing like ending your screed in a comma rather than using a period)
This is 50 Shades of Bullsh**. The other beneficiaries were the construction workers who were employed longer building a larger structure than would have been possible with more expensive materials. There were the concrete workers. The workers in the fabrication plants. The increased number of employees in the larger buildings. The companies that did the finish work for the larger building. On and on. Not to mention that the availability of cheaper steel was probably what made the project viable to begin with. The projects Newsweek discusses are actually Trump development projects so there isn’t even a profit involved as he’s retaining the property. He’s engaged in cost avoidance.
American steel is expensive for a lot of reasons, labor costs and environmental regulations high among them, and there is no longer a large American cold-rolled steel production capacity. This attack is no different than the one one Mitt Romney over Bain Capital shutting down a steel plant it had bought. It is nothing more that the socialist theory that the only reason business exists is to create jobs for other people and that profit is evil. There are millions and millions of great reasons to oppose Donald Trump but this kind of attack, like the attack on him over a legally operating Iranian bank being a tenant in one of his properties, is simply wrongheaded.