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April 12, 2002 4:50 p.m. Steel Sophistry Don Evans defends Bush on trade.

ommerce secretary Don Evans had some reporters and columnists over today to chat about the administration's economic policy and, especially, its policy on trade. An aide explained before he spoke that the administration's decisions on lumber and steel had been distorted in the press. Unfortunately, Secretary Evans did not clarify the issues involved.

Evans's main point was that the administration had no choice but to impose trade barriers on steel and lumber; it was a matter of enforcing the law. The administration, he said, was enforcing American law while complying with its obligations as a member of the World Trade Organization.

None of this is true. The administration initiated the steel case at the request of the steel industry; it didn't have to. Having asked the International Trade Commission to look into the matter and then received its recommendation, the president had — by law — complete, unchecked discretion over what to do. He chose to impose tariffs.

Steel was investigated under a section of American law, compliant with the WTO, that allows trade relief for industries that have been seriously injured by increased imports. During the period investigated, however, most categories of steel imports fell. The ITC got around that by some fancy footwork that will not (and should not) survive a WTO challenge.

When not making a claim of legal obligation, Evans argued that steel tariffs were necessary to overcome subsidies and market-distorting practices by other countries. That was not the legal rationale for the investigation or the tariffs; and the tariffs apply to countries whether or not they engage in any of these (unspecified) practices.

The administration's lumber protectionism is, by contrast, legally premised on Canadian subsidies. Whether those subsidies exist was a matter that Evans's Commerce Department had to decide. It found that they did exist because Canadian lumber is cheaper than American lumber. That's an obvious non sequitur, and WTO rules forbid that method of determining whether another country has subsidies that justify countervailing tariffs.

On steel, Evans expressed the hope for a "market-driven overcapacity reduction." How tariffs that keep marginal American steel producers afloat will reduce global overcapacity was not explained.

Nobody blames Secretary Evans for the steel and lumber decisions. But if he wants to defend them, he needs to find a stronger case.