By David Fickling / Bloomberg Opinion
If you want to reduce international trade and foreign relations to chest-beating displays of dominance, sooner or later you’re going to end up fighting about steel.
Hard, unbending, corrosion-resistant and essential to producing macho artifacts like skyscrapers, cars and armaments, the metal is indelibly associated with images of strength. President Donald Trump echoed that imagery in a photoshopped image last year showing himself as Superman, nicknamed the Man of Steel, on his Truth Social account.
Other autocratic leaders have had the same idea. Georgian revolutionary Iosif Vissarionovich Dzhugashvili chose the Russian word for steel when coming up with the nom de guerre for which he is best-known: Stalin. When Fascist Italy struck a military alliance with Nazi Germany three months before the start of World War II, Mussolini dubbed it the “Pact of Steel.”
Make no mistake, however: Trying to protect the steel and aluminum industries as a path to nation-building is a doomed project that will make America weaker, not stronger.
Tariffs of 25 percent on imported metal that Trump unveiled Monday will be as ineffective in fostering domestic production as the previous round of restrictions he kicked off in 2018. Since those actions, U.S. production capacity for aluminum has fallen by 32 percent, while steel is down 3.6 percent. Only a mad king would expect a different result from trying the same thing again.
If the latest round of levies is actually introduced — anyone’s guess, given the frantic policy to-and-fro of the past few weeks in Washington — they’ll serve only to damage producers and consumers in both the U.S. and its allies. The knock-on outcome will diminish those countries’ abilities to manufacture their own metal. Russia and China must be rubbing their hands with glee.
Unlike, say, mobile phones, computers, machinery and consumer goods, the U.S. doesn’t get much of this stuff from its geopolitical rivals. Instead, it’s overwhelmingly from allies and countries that the U.S. needs to keep on its side, most of all at a time when it can’t afford to stand alone against the rising tide of authoritarianism. Canada and Mexico, the European Union, Brazil, South Korea, Japan and Taiwan combined account for 80 percent of U.S. steel imports. Add in Bahrain, Qatar, and the United Arab Emirates — home to three of the biggest overseas U.S. military bases — and you’re looking at about 70 percent of imported aluminum, too.
The two metals are also some of America’s most extensively protected sectors: On top of the 2018 Trump administration tariffs, they are the subject of just under half of the 736 anti-dumping and countervailing duty orders and agreements currently in force.
This trade isn’t, as Trump appears to believe, some global zero-sum game, but a crucial aspect of maintaining profitable industries across a range of allies.
The U.S. and Canadian aluminum sectors, in particular, operate as a more or less integrated single industry: Canada uses its cheap and clean hydro power to smelt new metal and become the world’s biggest exporter of freshly smelted blocks, while the U.S. employs its vast consumer market to be the biggest exporter of scrap for making recycled aluminum. That shouldn’t be dismissed as just “waste:” Such recycled aluminum supplies about a third of global demand. Producers in each country are able to use trade as a safety value to maintain their own profits, without wasting capital on rolling mills and smelters where allies already have spare capacity.
If there was any remaining doubt about the incoherence of this policy, consider that Trump’s tariff comments came just hours after a joint announcement with Japan’s Prime Minister Shigeru Ishiba that Nippon Steel Corp. will be investing in United States Steel Corp. That proposal salvages some remnants of a deal from a mooted takeover that was blocked by both the Biden and Trump administrations.
About a quarter of U.S. Steel’s revenue is earned in Europe, however, also the biggest source of American steel imports after Canada. If Trump’s tariffs are imposed and Brussels inevitably reacts with its own restrictions, why on earth would Nippon Steel go ahead in spending money on a company whose largest export market has been pitched into yet another trade war?
The message of how that long-gone Pact of Steel sped the 20th century’s descent into madness isn’t purely a rhetorical one. Success in defeating the Axis powers depended fundamentally on the Allies’ openness to trade. The U.S. sent $180 billion (in 2016 dollars) in goods and services to the Soviet Union during the course of the war. Italy and Germany, on the other hand, barely traded with each other, apparently convinced that self-sufficiency was the most surefire path to victory.
There’s an economic history lesson there for all the Roman-saluting, pro-racism hangers-on milling around Washington these days. For all the Axis powers’ bluster, it was middle-of-the-road, pro-trade liberalism that ended up winning. The fascists, deservingly, lost.
David Fickling is a Bloomberg Opinion columnist covering climate change and energy. Previously, he worked for Bloomberg News, the Wall Street Journal and the Financial Times. ©2025 Bloomberg L.P., bloomberg.com/opinion.
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