A Slow Email From China

By Jason Togyer
The Tube City Almanac
June 01, 2017
Posted in: Commentary-Editorial

The following is a commentary. Commentaries represent the viewpoints of individual authors and are not those of Tube City Community Media Inc. or its directors.

Some people are skeptical of claims by American steel companies that Chinese companies are dumping steel pipe on the U.S. market. I've heard them say it's just American companies making excuses for being uncompetitive.

Would you believe that we here at Tube City Community Media get offers to buy steel pipe from China a couple of times per week? Here's one we got just this morning. The smiley face is a nice touch.

Notice that they're selling large-diameter, electric-resistance weld pipe --- exactly the kind of pipe that U.S. Steel was making in McKeesport, and which Dura-Bond Industries is soon going to start making again.

I'm assuming these companies Google "tube" and come up with our website --- and after all, we do have several sections of Tube City Online that deal with the steel industry. I guess if you don't speak English all that well, you might assume that we're in the steel pipe business.

If we're getting these kinds of inquiries, then people who actually do buy steel pipes --- natural gas companies, oil supply companies, whatever --- are getting bombarded with them. And is it any wonder that if they're trying to save a few bucks and make a profit on a project, they'd buy pipe overseas?

Which makes me think of something else:

One thing I rarely hear mentioned, in the debate over the "Affordable Care Act" (a.k.a. "Obamacare"), is that the United States, as far as I know, is the only country in the world where employers pay for their employees' health insurance.

In practically every other country, if people have health insurance, it's part of a government-run program.

Same thing with pensions --- if people have retirement benefits in other countries, it's a government-run program.

Now, think of how expensive it is for American companies to provide those pensions and health insurance plans to their employees. And how do they pay for them? They increase their prices.

Foreign companies, operating in countries where the government handles health insurance and pensions, aren't laboring under those handicaps, so they're able to charge less in many cases for their products. (And that's setting aside the fact that workers in China are being paid a tiny fraction of what workers in the U.S. or Western Europe are being paid.)

If the United States wants to be competitive with Europe and South America --- let alone China --- wouldn't it make sense for us to get away from a system where manufacturers must pay for their employees' health insurance and pensions, and shift that expense onto the federal government?

During a tour of the McKeesport electric-resistance mill giiven for Pennsylvania Gov. Tom Wolf and other local, county and state officials, Dura-Bond President Jason Norris noted that the company is offering generous and competitive salaries for its employees.

I can't speak for Norris, but I'll bet if he didn't have to offer health insurance and other benefits, he could afford to either pay his employees more in salaries, or invest more money back into the plant, or both.

Anyway: I just thought I'd share the tiny little piece of the global trade imbalance that touches this tiny little website in McKeesport.

And no, we have no intention to start importing pipe from China, or anywhere else, for that matter.

Opinions expressed in commentaries are not those of Tube City Community Media Inc.

Tube City Community Media welcomes replies and commentaries from its readers and is committed to printing viewpoints from residents of McKeesport and the surrounding area. To submit a commentary, email tube city tiger at gmail dot com, or write to Tube City Online, P.O. Box 94, McKeesport 15134.

Originally published June 01, 2017.

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