U.S. Steel Tariffs In March 2001, the Bush administration backed tariffs to protect the U.S. steel industry from foreign competition.

Subsequently, the World Trade Organization ruled that the tariffs violated international trade laws.

The European Union threatened to retaliate if the United States lost its appeal at a WTO hearing in November 2003. President Bush was faced with the decision of whether to extend or repeal the tariffs.

Steelmakers argued that protection from cheaper Chinese steel imports protected American jobs. Other U.S. industries claimed that the steel tariffs actually destroyed U.S. jobs. Use your knowledge of economics to surmise which U.S. industries would be hurt by a protective tariff on steel and why unemployment would rise in those industries. (Hint: Remember that tariffs increase domestic prices.)