Will Political Winds Sway Bush on Trade?

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Workers at Wheeling-Pittsburgh Steel Corp. take metal samples

As a candidate, George W. Bush promised "to end tariffs and break down barriers everywhere, entirely, so the whole world trades in freedom." Now, political reality has settled in. By March 6, President Bush must make one of the thorniest decisions of his presidency: whether or not to erect hefty tariffs on cheap imported steel to protect the withering U.S. steel industry. And the smart money in Washington has him opting for the tariffs.

One reason may be that domestic steel manufacturers are cratering — nearly 30 have declared bankruptcy since 1998. This week, the United Steelworkers of America is set to release a study claiming that inaction would cost 300,000 American jobs. Then, of course, there's politics. Steel is vital in the key battleground states of Pennsylvania, Ohio and West Virginia.

Internally, Bush's economic, foreign and trade policy advisers are warning the President that a high tariff could spark a nasty trade spat with U.S. allies. But most of his domestic and political advisers are telling him protecting U.S. steel is the right thing to do. Bush may try to split the difference with a modest tariff, but both the union and the manufacturers insist that a half-measure won't suffice. One sign that Bush takes the issue seriously: He added it to Vice President Dick Cheney's portfolio. The steelworkers will hold a rally this week in Washington to stir public sympathy for their cause. If the President delivers, says Bill Klinefelter of the historically Democratic steelworkers union, "The union will certainly give credit where credit is due." Translation: tariffs now will mean votes later.