There was further confirmation of economic recovery this week in a series of government reports. Productivity at U.S. companies in the third quarter had its best showing in 20 years. Domestic manufacturing in November also hit its highest level in 20 years. And construction spending in October set a new record for a fourth straight month.
Against that backdrop, the Bush administration turned its attention to international matters of economic and political impact. Specifically, the removal of U.S. tariffs on imported steel.
The president imposed the tariffs in March of 2002 to protect the U.S. steel industry from an influx of cheap imports. But the World Trade Organization last month ruled the duties were illegal, leading Japan, South Korea and the European Union to threaten retaliation if the tariffs stayed in place.
Indeed, to pressure the president, the Europeans carefully chose a retaliation list of some $2.2 billion in U.S. products. The targeted goods, ranging from oranges to pajamas, are produced in states critical to President Bush's re-election bid. The E.U. removed the threat on Thursday after the tariffs were lifted.
President Bush: "The economic stimulus package thatwe passed out of the U.S. Congress is working."
In announcing the end of the duties, the president declared them a success. He said the 20 months they were in effect bought the U.S. steel industry time to modernize and protect jobs. Even so, some in the U.S. steel industry called the decision to relent unfortunate.