American Stainless Steel Table Flatware Industry Message to the Congress Transmitting a Report

To the Congress of the United States:

In accordance with section 203(b) (2) of the Trade Act of 1974, enclosed is a report to the Congress setting forth my determination that import relief for the U.S. stainless steel table flatware industry is not in the national economic interest, and explaining the reasons for my decision.

JIMMY CARTER

The White House,

June 30, 1978.

IMPORT RELIEF ACTION

STAINLESS STEEL TABLE FLATWARE

As required under section 203(b)(2) of the Trade Act of 1974, I am transmitting this report to Congress setting forth the action I will take with respect to stainless steel table flatware covered by the affirmative finding on May 8, 1978 of the U.S. International Trade Commission (USITC) under section 201(d) (1) of the Trade Act. As my action differs from that recommended by the USITC, I have included the reasons for my decision.

After considering all relevant aspects of the case, including those considerations set forth in section 202(c) of the Trade Act of 1974, I have determined that import relief for the domestic stainless steel table flatware industry would not be in the national economic interest for the following reasons:

1. The imposition of import relief would not be an effective means to promote adjustment in the industry. The dominant firm in the domestic industry now supplies over half of all domestic production (almost three quarters in value terms) and currently utilizes technologically advanced manufacturing equipment. This firm, as well as a number of smaller firms who are operating profitably, should remain profitable.

2. All the major firms in the industry have been increasing their amounts of imports in order to supplement the particular product lines in which they specialize and to improve their overall profitability and this trend is expected to continue.

3. Import relief would discriminate against low-income purchasers and substantially increase costs to consumers. (Under the USITC's recommended remedy, costs are estimated to increase by at least $33 million in the first year.) These costs may increase even further if the moderating influence that low-price imports have on the prices of domestically produced flatware is eliminated. In a time when we are striving to control inflation, these costs are too high.

4. This industry has had import relief in 13 out of the past 20 years. Providing import relief again would be inconsistent with the internationally accepted concept that import relief in escape clause cases should be of a temporary nature.

5. Employment losses since 1975 have been small and many of the unemployed workers are currently receiving Trade Adjustment Assistance benefits. The USITC estimates gradually increasing domestic production of flatware even in the absence of relief and this should have a stabilizing effect on the number of jobs in the industry.

6. Expedited consideration of adjustment petitions from workers, firms, and communities is still in effect as a result of the Presidential determination on the 1976 import relief case.