The prices of consumer goods are rising at a faster rate than at any time in recent history. But the price of one particular non-consumer good is rising so fast that it makes food and energy prices look like they are standing still.
None of the items you buy at the supermarket or the service station has gone up 132 percent over the past 18 months. None of the items you buy has gone up 43 percent in the last four months.
Yet that’s what has happened to the price of scrap iron and steel. A combination of exports and heavy demand at home has caused this skyrocketing climb.
Exports of iron and steel scrap are now breaking all-time records. More than a million tons left our shores in February of this year alone. That’s enough steel to build hundreds of thousands of automobiles.
Iron and steel are recyclable metals. Ferrous scrap is a prime raw material for steel companies that do not own any iron mines. Iron and steel scrap are part of the wealth of America that can be used for thousands of finished products needed by consumers, industry, transportation, and farming.
The United States is almost the only major nation that permits the unrestricted export of iron and steel scrap. Most nations don’t have the ferrous scrap resources that we have, but if they did you can be sure they would put their national self interest ahead of letting their wealth drain away.
Usually the problem businesses have is that the federal bureaucrats indulge in too much control and harassment of private enterprise. The problem here is that, for some strange reason, the U.S. Commerce Department refuses to use the power given by the Export Administration Act to restrict the rapidly increasing exports of ferrous scrap.
Many other nations have developed splendid steel plants that turn out manufactured goods which undersell American goods on the world market. Foreign plants don’t have to reduce their productivity by hiring on the basis of affirmative action quotas. They can hire the most qualified, productive, and efficient workers they can find.
Foreign plants don’t have to pay the high taxes that American industry must pay. Remember, we are required to keep our taxes high so we can keep doling out billions of dollars in foreign handouts every year, an expense our foreign competitors do not have to figure in their costs.
We are also required to keep U.S. taxes high because we provide much of the military defense of the free world, including the defense for many nations which keep their own military forces minimal and depend on us to protect them from aggressors.
Last year, Congress quietly slipped a provision in our laws that would “authorize the Commodity Credit Corporation, notwithstanding any other provision of law, to provide short-term financing (repayment in three years or less) for commercial sales of United States agricultural commodities out of private stocks to the People’s Republic of China.”
Obviously, Red China is not a good risk for any commercial loans. Red China has no money to, buy from the United States or any sufficient volume of goods to sell which Americans want to buy. By ordinary commercial standards, no bank would lend China the funds to buy on credit.
But U.S. government agencies such as the Commodity Credit Corporation now give or guarantee loans to Red China. The Export-Import Bank has been giving credit to the Soviet Union and its satellites for several years.
Unfortunately, the America Last policy that has guided our State Department through many Administrations has also infected the Commerce Department. Our government seems incapable of putting the interests of Americans ahead of the interests of every foreign country anywhere on the globe, including the Communist countries.
