U.S. Senators Charles E. Schumer and Kirsten Gillibrand, a member of the Senate Armed Services Committee, joined a group of their Senate colleagues in introducing new legislation to ensure that armor plate for America's military is made in America. The bill would restore a 35-year rule, overturned by the Department of Defense in 2009, requiring that steel purchased by the U.S. military be 100 percent made in America--that is, both melted and finished in the United States. The legislation would be a boost for both Klein Steel, with locations in Western New York, and Nucor, with its Auburn location.
"Our military steel should be proudly stamped "Made in the U.S.A.' each and every time," said Senator Schumer. "Great manufacturers from every corner of our country are ready to answer the call of duty -- let's give them the chance to step up and produce the high quality steel that our military needs, which would boost jobs across the country and help New York companies. American workers can meet the military's need, so we should call on them instead of workers halfway around the world in China or other countries that don't play by the rules and undercut U.S. jobs at every turn."
"There are no better manufacturers than the ones right here in New York State," Senator Gillibrand said. "And there's no reason the products we use to defend our nation shouldn't be stamped with the words "Made In America.' Our bill can help our manufactures grow, create new jobs, and guarantee our men and women in uniform are armed with the highest quality equipment."
Steel armor plate is used for military vehicles, tanks, and equipment. Under Defense Department regulations, specialty metals procured for defense purposes--including steel armor plate--must be produced in the United States. Despite more than 35 years of legal interpretation and administrative practice requiring that specialty metals be melted in the United States, the Defense Department in 2009--in the midst of the wars in Iraq and Afghanistan and during a time when the demand for steel was high--published a final rule defining the word "produced," as it applies to armor plate under the Special Metals Amendment, to include simple finishing processes. This means that armor plate melted in foreign countries, including Russia and China, could be imported and subjected to simple finishing processes in the United States and then deemed to have been "produced" domestically.
Countries like China provide illegal subsidies to their domestic industries, along with undervaluing currency so their exports have an unfair price advantage. The senators were successful in passing the Currency Exchange Oversight Reform Act in 2011, legislation that represents the biggest bipartisan jobs bill--at no cost to American taxpayers--to clear the Senate last year. The bill would treat currency manipulation as an unfair export subsidy, giving the U.S. new resources to provide immediate relief for American manufacturers being undercut by cheap Chinese imports.
The American Steel and Security Act would require steel armor plate to be both melted and finished in the United States, not only protecting American steel jobs, but our country's national security. The Senators noted that steel companies across the Empire State utilize Nucor steel, whether it's for military plate purposes or simply for raw material supply. Klein Steel, with several locations in Western New York, utilizes much of Auburn's materials and both Klein and Nucor agree that steel made in the U.S. would create more jobs here at home. As Nucor continues to supply, considers expanding, and diversifying its production line in Auburn and across America, it takes its other steel partners' goals into mind, often basing production off their demands. Many are working to hone in on the defense industry, which is why the Senators are seeking to ensure that foreign steel melted abroad does not undercut the ability of U.S. producers like Nucor.
After numerous Congressional inquiries and report language questioning DOD's interpretation of "produced," the FY11 National Defense Authorization Act included a provision requiring a review and, if necessary, revision of the existing regulation to ensure the definition is consistent with Congressional intent (the review was required to be completed within 270 of enactment of the law, i.e., early October 2011). On July 25, 2011, DOD published its request for comment, and the deadline for public comment was September 8, 2011. As of early 2012, DOD has yet to finalize its review.
The legislation, written by Senator Sherrod Brown (D-OH), was also introduced by Amy Klobuchar (D-MN), Robert P. Casey, Jr. (D-PA), and Al Franken (D-MN).
In a December letter, Senators Gillibrand and Schumer called for a review of the definition of "produced" as it relates to specialty metals. Current language on armor plate steel -- a critical protective element for troops in warzones -- considers steel melted outside of the U.S. to be "domestic" and compliant with the Specialty Metals Amendment. The Senators are pushing for new language that would require that armor steel plate be melted in the U.S. and would ensure that federal procurement regulations favor domestic sources of steel.