A change of government – especially one as dramatic as the most recent one – is always a time of high hopes. Voters, impressed and maybe just a bit daunted by what they've just done, focus on a fresh start and transformative power of hope.How could it be otherwise after weeks of escalating promises and political rhetoric?This time around, the Liberal Party won strong voter support for their commitment to stimulate the Canadian economy by spending on infrastructure upgrades and public works megaprojects. However, any economic opportunity from this focus on the future, will be squandered by the past - unless bold action is taken now.Economic prosperity requires a partnership between government, industry and labour. If one partner is weak or absent, the efforts of the others is undermined. And that is precisely the threat facing the Canadian steel sector today.Infrastructure projects typically require a great deal of steel – whether it is used to build bridges, buildings or pipelines. But just as the demand for steel could be set to increase, Canada's domestic industry is collapsing.The stakes are high.Steel manufacturing is a $14-billion a year business that employs 18,000 Canadians directly and about another 100,000 indirectly. The most conclusive evidence of the crisis faced by the industry is the recent fate of the former Stelco. U.S. Steel, which bought the one-might Canadian company in 2007, moved the most lucrative supply contracts to its operations in Pittsburgh and left employees and pensioners with no medical or retirement benefits. This arrangement was accepted by an Ontario court because the state of the business and the company is so dire.Given global overcapacity and slumping demand from a depressed resource sector, this situation isn't about to improve any time soon. The World Steel Association predicts the industry will underperform GDP growth over the next several years as a result. For steelmakers, even the potential benefit of domestic infrastructure spending will be undermined by another global reality: unfair trade practices.The future of the Canadian steel sector has been systematically destroyed by low-cost imports from countries that do not have the same fixed labour and environmental costs. The new Liberal government needs stand up for Canadian steel producers.For several years, we have been lectured by government about the need to compete globally and become more efficient by “thinking outside the box.” At the same time, however, management and labour have had to work harder than ever to balance fair wages and benefits for workers with the climbing cost of environmental regulations and other operating costs that most of their international competitors do not incur.Free trade is one thing, but fair trade is quite another.Those companies that want to defend themselves from these low-cost imports have to deal with a trade remedy process that remains expensive and time-consuming, even after some recent efforts to streamline and modernize it. The money that goes into underwriting investigations and wrangling trade-related red tape, furthermore, is money that is not invested in new equipment, product development or job creation. Important redress legislation has stalled, even as the debate about further expanding trade under the new Trans-Pacific Partnership has gained momentum.These issues, rooted in the past, have the ability to undermine the future. Even as Canada and its new government look forward, they must remember their partner and sustain the important work that still needs to be done.If competitors like China or Turkey are not held to the same standards of production as Canadian steel companies, they will continue to flood our market with low-cost steel. That undermines domestic companies and domestic jobs – as we have already seen.The Canadian voters who are about to pay the cost for a new national infrastructure program have to ask themselves – before it is too late - if they want their tax dollars to be spent on further eroding an already-hobbled industry. And undercutting the jobs of Canadian steelworkers.Michael DaPrat
President, United Steelworkers Local 2251
Essar Algoma Steel