In the News

Wichita Eagle
Dion Lefler

Increased taxes on imported steel and aluminum as proposed by President Trump would put a big dent in Kansas' manufacturing industry, Sen. Jerry Moran said Friday.

The president has been pushing for tariffs on raw metal from other countries in an effort to revive the struggling steel and aluminum industries in the United States; Moran is part of a group of senators and representatives who say the added taxes would do more harm than good.

"The bottom line on tariffs is it increases the price for consumers," Moran said. "And what we buy then costs more. That means we buy less. That means a slower economy."

Moran made his remarks after touring JR Custom Metal Products, a south Wichita shop that fabricates and coats metal parts for a wide variety of industries, ranging from heavy rollers used in Ditch Witches to non-skid floorboards for postal delivery trucks.

"The outcome of this tariff consideration has a consequence on their business, and how many people they're going to employ and whether they're going to expand," Moran said.

Patricia Koehler, the president and chief executive of the company, said costs of raw steel and aluminum are already rising — sometimes by as much as 10 percent in the time it takes to fill out the order. And tariffs would only make it worse, she said.

"This company has 150 employees and in all the industries we support, we want to continue to keep the product here in our state," Koehler said. "And to be able to do that, of course steel is our No. 1 commodity that we buy.

"If other countries can obtain the metals they need without tariffs, it makes Kansas products less competitive in international trade, she said.

"We need to make sure we're competitive because we do compete with European countries for some of the product that we build — and also China," she said. "Hopefully maybe we can bring our president to Kansas so he can see what Kansas has to offer."

Moran said the Kansas business perspective is what he needs to fight tariffs in Washington. He also visited Spirit AeroSystems on Friday.

With almost no metal production of its own, Kansas has a lot to lose and very little to gain from a tariff.

Only about 80 Kansans are directly involved in steel and aluminum production, according to the financial web site MarketWatch.

But 87,000 Kansans are employed making things out of metal brought here from elsewhere.

Moran said he thinks tariff foes are getting some traction.

Under pressure from pro-trade states and business interests, the White House has already announced intentions to exempt Canadian and Mexican metal from the tariff — at least for now. But whether that stays that way depends on talks to renegotiate NAFTA, the North American Free Trade Agreement, which brought down many trade barriers between the U.S., Canada and Mexico.

Beyond just the increased costs for consumers, tariffs on trade have a tendency to multiply, Moran said. That also puts Kansas agriculture at risk, he said.

"What we know is countries, they take revenge on us and increase tariffs on products we sell to them," Moran said.

For example, China recently slapped a tariff on grain sorghum, a major Kansas export, in retaliation for Trump tariffs on solar energy panels and washing machines, Moran said.

"They pick things that get our attention and certainly that's an example," Moran said. "So we have to worry about increasing tariffs by other countries and this just escalating.

"The economy in Kansas depends on our ability to sell elsewhere," Moran said. "Sometimes even a farmer will say 'Forget the rest of the world, let's just take care of ourselves.' You could say: 'Well, what 48 percent of your acres do you no longer want to plant in our state.'"

"We need every market we can get," Moran said. "We need more markets, not less. And I will continue to deliver that message."

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