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Petitions to Restrict Canadian Lumber Imports Would Harm U. S. Consumers, Workers

on 4/22/01.

WASHINGTON, April 22 /PRNewswire Interactive News Release/--More than 20 home builders, lumber dealers and other supporters of free trade and consumer interests testify tomorrow before the U.S. International Trade Commission (ITC) here, calling for the ITC to reject petitions that would impose a duty of as much as 78 percent on Canadian lumber coming into the United States. After the April 1 expiration of the U.S./Canada Softwood Lumber Agreement of 1996 (SLA), the Coalition for Fair Lumber Imports, a Washington, D.C.-based lobbying group, filed a countervailing duty petition on April 2 for an approximate 40 percent duty and an anti-dumping duty between 28 and 38 percent. "Those presenting oral and written testimony before the ITC come from all regions of the country, representing the broad cross section of Americans who were harmed by the Softwood Lumber Agreement between the U.S. and Canada that expired April 1, and would continue to be hurt even more by these petitions," said Susan Petniunas, spokesperson for the American Consumers for Affordable Homes (ACAH). The ACAH is an alliance of 14-organizations, representing approximately 95 percent of softwood lumber use in the U.S.
"Acceptance of the concepts in these petitions would be the equivalent of a 78 percent 'hidden' tax on consumers wanting to purchase a new home, remodel their home, or even buy a new bed," Petniunas continued. "That is ludicrous."
More than 20 home builders and lumber dealers will present oral testimony or written statements tomorrow to the ITC, all opposing them.
The petitions before the ITC would increase the cost of a new home by approximately $ 2,000-$ 4,000. Based on earlier calculations by the U.S. Census Bureau, a price hike of such a magnitude could knock as many as 1.2 million households out of the market for purchasing a new home.
"The ITC must listen to the needs of American consumers and workers, not just the desires of a few wealthy lumber mill owners," Petniunas said. "This is an issue that will impact home buyers and workers and their families all across the country. The impact on the economy could be disastrous."
Approximately six million U.S. workers are involved in lumber-using businesses, including home builders, remodelers, lumber dealers, and industries like window and bed makers. Workers associated with the consumers of lumber outnumber lumber-producing workers by 25 to 1 in the United States.
Federal Reserve Chairman Alan Greenspan testified earlier this month before the Senate Finance Committee that slowing economic growth could spawn protectionist measures in the form of countervailing and anti-dumping suits that are "unwise and surely self-defeating."
"These forms of protection have often been imposed under the label of protecting 'fair trade,' but often times are just simple guises for inhibiting competition," Greenspan told the Committee. "If we were to move in the direction of protection, that could create some very significant problems for the American economy."
According to ACAH, action urged in these petitions would have a number of negative impacts:

* Such a duty would raise the price of lumber by 33.2 percent, compared
to the price under conditions of free trade. This price increase would
cause U.S. consumption of softwood lumber to fall by 5.6 percent. U.S.
softwood lumber production would increase by 13.3 percent.

* If the 78 percent duty of softwood lumber from Canada is put into
effect, the cost to the American consumer will be $ 6.10 billion per
year. Of this, $ 4.02 billion will go to the U.S. lumber producers and
the net loss to the U.S. economy will be $ 2.08 billion per year.

* A 78 percent duty on softwood lumber from Canada will add approximately
$ 2,000 - $ 4,000 to the price of a new home. As a result, many families

will be unable to purchase a new home, causing a reduction in the
number of housing starts in the U.S. and profound injury to the U.S.

* A 78 percent duty on imports of Canadian lumber would reduce the level
of imports by 34 percent.

"These petitions are bad news for American consumers, American workers and the national economy," Petniunas said.
ACAH members include CHEP USA, Citizens for a Sound Economy, Consumers for World Trade, Free Trade Lumber Council, The Home Depot, International Mass Retail Association, Leggett & Platt Inc., Manufactured Housing Association for Regulatory Reform, Manufactured Housing Institute, National Association of Home Builders, National Black Chamber of Commerce, National Lumber and Building Material Dealers Association, National Retail Federation, and the United States Hispanic Contractors Association.


SOURCE American Consumers for Affordable Homes

CONTACT: Susan Petniunas of American Consumers for Affordable Homes, 703-379-6778