Welfare: bad (unless it's corporate): W finally knuckled under and repealed the illegal steel tariffs. No surprise as he really had no choice. It's also a good time to do it. He has a year to repair the damage done politically before those states most affected turn in their electoral votes. It was a sop to begin with so this really shouldn't have any demonstrable effect on our economy at large (which is humming along quite nicely in any regard). Plus, the tariffs hurt as many American businesses as it supposedly helped.

The tariff fiasco reflects our government's unwillingness or inability to let the giant industries die a natural death, i.e airlines. There is no doubt that the steel industry employees got a raw deal w/r/t their pensions, and for that I have genuine sympathy. Of course those pensions were rather extravagant to begin with and for that, one can thank the unions. Still, American steel just doesn't cut it on the scale that it once did.

The most interesting point that the Connie makes is that Bush will take credit for his tariffs actually having changed the face of the steel industry:

What kind of victory can he claim? In the 20 months since the tariffs were imposed, the steel industry has consolidated. Some ailing steel firms, such as National Steel and Bethlehem Steel, have been gobbled up by larger competitors. The industry’s largest union, the United Steel Workers of America, has agreed to more flexible work practices, profit-sharing and even some redundancies in order to give its remaining members a fighting chance of saving their jobs. Just as important, demand for steel is picking up: the world may face a supply shortage and a price spike next year, predicts World Steel Dynamics, a research firm.

Not so fast say industry experts:

But if anything, the tariffs simply delayed the inevitable. By artificially raising the price of steel, they added to the profits of ailing firms, making them more expensive to acquire. Europe went through a similar round of mergers a decade or more ago without the help of tariffs. The trade barriers Mr Bush repealed on Thursday were a comfort blanket, not a spur, for the industry.

Still, the industry is showing signs of life once more. The real hope is that American Steel will finally get the picture. We shouldn't worry though. Look how much the airlines learned from 9/11.