2002 United States steel tariff
Canada and Mexico were exempt from the tariffs because of penalties the United States would face under the North American Free Trade Agreement (NAFTA).There was a widespread belief on all sides of the debate, confirmed by top Bush administration officials, that politics played a role in the decision to impose tariffs.[5] The placement of the tariffs was an odd one for Bush, who had signed numerous free trade agreements during his term in office[citation needed].Immediately after they were filed, the European Union announced that it would impose retaliatory tariffs on the United States, thus risking the start of a major trade war.To decide whether or not the steel tariffs were fair, a case was filed at the Dispute Settlement Body of the World Trade Organization (WTO).[10] According to a 2005 review of existing research, all studies on the tariffs "find that the costs of the Safeguard Measures outweighed their benefits in terms of aggregate GDP and employment as well as having an important redistributive impact.On the other hand, the ITC admitted that the authors of the CITAC study had controlled for changes in overall manufacturing employment, and also admitted that the CITAC study's estimate of job loss in the steel-consuming sector was only half that reported by steel-consuming firms themselves in answers to questionnaires sent by the ITC, and only one-fifth that reported by the Bureau of Labor Statistics for the sector during the same period.