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Will Donald Trump make the Iron Range great again?

Just like he did in West Virginia coal towns and the Ohio Rust Belt, Donald Trump had a broad appeal in northeastern Minnesota — something few people predicted when the Manhattan tycoon began his longshot campaign for the White House.

Trump will be sworn in as president on Friday, in part, because people in places like this believe he is committed to revitalizing America’s heavy industry and natural resources business.

In the campaign, Trump repeatedly promised to accomplish that through trade policy, advocating a protectionist path that uses tariffs and trade litigation to gain an edge on foreign competitors like China. He also promised to loosen regulation on the domestic natural resources sector.

On Minnesota’s Iron Range — a longtime Democratic stronghold where Trump carried towns and precincts that haven’t gone GOP in many generations — there’s hope that Trump will make good on those promises, and help reverse decades of decline in the region’s mining and steel sectors.

As he takes office, how is Trump’s administration shaping up on key Iron Range issues — and do pro-mining Rangers believe he can really spark a comeback?

Trump picks steel hawks for key cabinet posts

With key Trump issues like immigration and national security, political observers have struggled to read the transition tea leaves to get a sense of what direction the president-elect might take when in office.

Not so with trade: Trump’s picks for key administration positions have signalled a strident, unambiguous direction that hews closely to his campaign rhetoric.

For the two most important posts for trade policy, the president-elect has picked two bonafide “fair trade” hawks, each of whom has extensive experience in mining and steel. And for jobs relevant to natural resources and land use, Trump has picked people far more amenable to ramping up domestic mining, logging, and drilling than their predecessors.

The appointee widely expected to have the most sway on trade policy in the White House is another New York billionaire: Wilbur Ross, Trump’s pick for Secretary of Commerce.

Ross, sometimes called the “King of Bankruptcy,” made his fortune investing in and restructuring companies, specializing in heavy industries like steel and auto manufacturing.

He was on the board of directors of the world’s largest steel company, ArcelorMittal, before resigning his seat ahead of his confirmation hearing on Wednesday. (ArcelorMittal owns a mine in Virginia, Minnesota, one of the Iron Range’s smaller, but more consistently productive, facilities.)

Ross’ deep experience in the steel industry is complemented by a protectionist worldview he shares with Trump.

Commerce Secretary nominee Wilbur Ross testifying
REUTERS/Carlos Barria
Commerce Secretary nominee Wilbur Ross testifying before a Senate Commerce, Science and Transportation Committee hearing on Wednesday.

In his confirmation hearing before the Senate Commerce Committee, Ross declared his first priority is re-negotiating the North American Free Trade Agreement, which Trump repeatedly called a bad deal for the U.S., and called for tough measures to retaliate against countries that “dump” subsidized steel into the U.S. market, undercutting domestic product.

The United Steelworkers union, in a move that raised some eyebrows, gave Ross their seal of approval. But some fair-trade advocates remain skeptical of where he truly stands on key trade issues: a Reuters report found Ross sent 2,700 U.S. jobs overseas during his career in business.

Trump’s selection for U.S. Trade Representative, Robert Lighthizer, is being interpreted as an even clearer sign that the president-elect plans to make good on his tough talk on trade.

A corporate lawyer with decades of experience defending U.S. heavy industry interests, Lighthizer has previously represented U.S. Steel in court, and was actively involved in litigating anti-dumping cases. 

Lighthizer also served as deputy trade representative under Ronald Reagan, where he grew to view targeted, punitive tariffs as effective tools in giving the U.S. a competitive trade advantage. In the 1980s, when concern centered around the U.S. trade imbalance with Japan, Lighthizer used tariffs to stem the flow of Japanese cars and appliances.

In recent years, Lighthizer has been a vocal critic of China’s trading practices. The steel industry was delighted at his selection: the president of the Steel Manufacturers’ Association said in response the group is “increasingly optimistic that the Trump administration is serious about addressing the unfair trade practices of some of our trading partners.”

Land use, trade policy, eyed as keys on Iron Range

What does all this mean for the Iron Range? Supporters of the mining and metals industries are cautiously optimistic that the Trump administration will be friendly to the region’s industry — friendlier, at least, than the Obama administration was.

According to Kelsey Johnson, president of the Minnesota Iron Mining Association, a Duluth-based mining trade group, predictability from D.C. is key.

“This is the case with any administration, but what we like to have is consistency in regulation, and we don’t necessarily like a wildly changing landscape. We’ve seen that in the last month and a half.”

She referenced some 11th-hour rules from the Obama administration, like its decision to deny the renewal of Twin Metals’ lease on land near the Boundary Waters, where the company planned to build a massive underground copper-nickel mine.

“It seems almost spiteful what we got,” Johnson said.

Frank Ongaro, who runs Mining Minnesota, a coalition of pro-mining organizations, echoed those sentiments, saying consistent and reasonable policy from Washington will benefit the industry.

“Those two things will invite investment into our state,” he said. “And right now, we don’t have that.”

Ongaro cited some encouraging early signs from the Trump administration, including his nominee for secretary of the Interior, Montana Rep. Ryan Zinke, whose confirmation hearing comments Ongaro called “extremely positive” for the mining industry.

His group plans to press the Trump administration to roll back Obama measures seen as detrimental to the Iron Range economy, like the Twin Metals rule. (Legally and procedurally, reversing the administration’s move there could prove difficult.)

“We’re hopeful,” Ongaro said. “A new administration is in town, they’re stating strong support for jobs, and hopefully they’ll work quickly to undo this silliness.”

Johnson is cautiously optimistic, and said Ross’ and Lighthizer’s backgrounds were refreshing. “This is a little bit different than what we’ve ever seen before, so we’re hopeful there’s going to be a change and a shift,” she said.

The Hull–Rust–Mahoning open pit iron mine
The Hull–Rust–Mahoning open pit iron mine, operated by the Hibbing Taconite Company, near Hibbing, Minnesota.

On the trade side, Don Fosnacht, associate director at the University of Minnesota at Duluth’s Natural Resources Research Institute, said Trump will need to lead a trade enforcement regime that is more proactive in stopping practices like steel dumping. (The NRRI is funded by a combination of public and private sources, including companies like Xcel Energy.)

Many industry advocates believe steel dumping and aggressive trading practices from competitors is a key reason why the U.S. steel industry is struggling. In December 2015, Obama chief of staff Denis McDonough went to the Iron Range to hear concerns; the following May, the adminstration slapped a 500 percent increase in tariffs on cold-rolled Chinese steel, used for cars and appliances.

In Fosnacht’s view, though, much of the damage had already been done. “One of the problems with the way trade cases have been is they wait for harm,” he said. “To prove your case you had to suffer great harm. It would be better if we had more streamlined ways to basically control the situation upfront rather than wait until you have a major problem.”

Fosnacht, a former steelworker himself, said that Lighthizer is equipped to play a role in tackling this issue. In the Reagan administration, Lighthizer helped negotiate voluntary restraint agreements, a protectionist tool that limits the exports of a particular country’s product.

They are now prohibited under the World Trade Organization — an organization Lighthizer is said to disdain — but that kind of thinking could be an element of the Trump approach on trade.

“If you can look at that from the perspective of, what is it we want to have in terms of a partition between imports and what we produce domestically, that’d be a starting point,” Fosnacht said.

Trump and his deputies may find sympathetic Democratic ears in Congress on that point  — particularly Rep. Rick Nolan, the Democrat who won re-election to the 8th District seat in the face of strong Trump headwinds. (Trump beat Clinton by 15 points in the 8th.)

Nolan is no Trump supporter, but he made clear he’d be willing to work with the president-elect on trade and infrastructure. The two share views on trade, advocating for strong measures slapping high tariffs on competitors. Last year, Nolan proposed a bill to impose a five-year moratorium on importing steel to the U.S. — a drastic measure.

“One of the areas I’ve said repeatedly with respect to Trump, when it comes to trade, when it comes to rebuilding infrastructure, I’m optimistic,” Nolan said.

“We can outproduce anyone in the world if we have a level playing field.”

‘At least we have hope’

In this boom-and-bust region, though, few are under any illusion that Trump will prove a salve to long-standing, entrenched economic and political problems.

The notion that Trump’s talk and cabinet selections, Johnson said, “is going to be the key and the answer to solve all our problems, I’m not going to go that far… There are many moving parts.”

But people like Joe Baltich are willing to take a gamble on the New York billionaire. Baltich runs a lodge in Ely, a mining town on the edge of the Boundary Waters Canoe Wilderness. He’s seen his town decline over the decades, and believes that expanding mining projects will help the region survive.

When the Obama administration decided not to renew Twin Metals’ lease, Baltich was angry. As soon as the ruling came down, he started a Facebook group, called Fight for Mining Minnesota, to try and draw attention to the cause.

That was in December. Now, Baltich says, the private group has close to 12,000 members, and estimates two-thirds of them are Trump supporters. He says the region is feeling cautiously hopeful that Trump will take the steps needed to bring back communities that have suffered decades of decline.

“We feel like we’ve been left behind,” he said. “We feel like there’s a chance Trump will look at us and say, let’s see if I can help you people. I can’t tell you everyone is going, ra ra, Trump’s going to change it.”

“We’re looking at it practically,” he said. We are more hopeful with the Trump administration.”

If Hillary Clinton had won, Baltich said, there wouldn’t have been hope for the Iron Range.

“Now, we have hope. We may not get it, but at least we have hope.”

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Comments (25)

  1. Submitted by Dan Landherr on 01/20/2017 - 09:57 am.

    Steel production is a shrinking industry

    This industry report says excess production is the biggest issue.

    http://www.ey.com/Publication/vwLUAssets/EY_-_Global_steel_2014/$FILE/EY-Global-steel-2014.pdf

    According to the report, there are 1 million excess people employed in steel production globally. How would we ever expect to INCREASE employment in Minnesota while global employment in the same industry shrinks? It is really difficult to gain share in a shrinking market and it is far more likely that global companies purchase the production capacity in Minnesota and keep it idle to protect their overall profits.

    • Submitted by Julie Moore on 01/20/2017 - 11:32 am.

      AGREED!

      It is almost sad when we close our eyes to industry trends and then try to blame others for why there is no employment. These areas need to catch up and find a new industry. Sounds like they have missed part of the green jobs opportunity but I’m sure there is still something available. The entire north has communities like Ely taking advantage of the travel market and people wanting to get back to nature. (https://www.mprnews.org/story/2016/08/02/ely-minnesota-economy-tourism-copper-mining) It takes people, creative people, to make things happen.

  2. Submitted by Matt Haas on 01/20/2017 - 11:18 am.

    The dissonance is deafening

    Perhaps someone might ask Mr. Beltich why I as a paying consumer would pay to visit his lodge on the edge of a mine ravaged moonscape. The wilderness is the ONLY reason anyone who doesn’t live on the range has any reason to visit, or contribute their tourist dollars. What do they plan on open pit tours when the mines go bust? They will, just as they always do. I just don’t understand how folks can be so unthinking about future consequence. Desperation is a powerful drug it seems.

  3. Submitted by Hiram Foster on 01/20/2017 - 11:19 am.

    Democrats

    Paul Wellstone used to like to say that he was a member of the Democratic wing of the Democratic Party. There have been times, I must admit, when it seems to me that Republicans are more supportive of Democratic policies than Democrats are. I took Econ 101, in college, I am familiar with the arguments for free trade. I even agree with some of them. But I wonder, why is it Republican Donald Trump who is America’s foremost advocate of protectionism? Shouldn’t that be a Democratic Party position?

    • Submitted by Pat Terry on 01/20/2017 - 12:54 pm.

      Protectionism

      Because protectionism is bad economic policy that will cost jobs rather than create them. And because Democrats rely on facts and evidence and not ignorant populism.

      • Submitted by Hiram Foster on 01/20/2017 - 02:32 pm.

        Protectionism

        Maybe so, but a number of protectionist countries do seem to be prospering. Does it really make political sense to impoverish our nation for the economic benefit of others?

        • Submitted by Pat Terry on 01/20/2017 - 03:19 pm.

          No

          Protectionism is good politics, but terrible economics. The idea that free trade is what caused manufacturing jobs to leave is simply a myth – those jobs were leaving anyway or got automated. Eliminating NAFTA wont’t bring them back and may cost manufacturing jobs. It’s the policies of an economic illiterate like Trump which will impoverish us, not free trade.

          • Submitted by Hiram Foster on 01/22/2017 - 06:38 am.

            Protectionism is good politics, but terrible economics.

            So why don’t we adopt protectionism? Particularly since the economics terrible as they might be, are terrible for someone else, someone who doesn’t vote in American elections?

  4. Submitted by Joel Stegner on 01/20/2017 - 12:21 pm.

    Minnesota West Virginia style

    Am I missing something? Isn’t being able to live in a place with safe communities, a clean environment and the ability to walk out the door and enjoy uncrowded spaces for recreation such as hunting, fishing, boating, golfing and hiking great already?

    Of course, jobs are important, but has American business wanted to buy American to support America lifestyles? Or pay workers well, versus breaking unions in order to pay less, offer fewer benefits and reduce hours? And are the profits of these mining companies, many foreign owned, going to stay in the area or the country? And when the deposits run out, will the companies evade their clean-up responsibility?

    If the Minnesota example isn’t good enough, look at what American business did to West Virginia – left it an impoverished wasteland. While Trump promises big coal is coming back and locals want to believe him, explain how that is gong to happen when other fuel sources are cheaper and cleaner?

    Tight government regulation is the only conceivable way to let big polluting mining operation into a region where it could kill tourism and ruining the favored outdoor lifestyles of locals is tight controls and financial guarantees that mining companies won’t agree without government pressure.

    Clearly, Trump will not protect the environment. In fact, watch for his administration to try to overrule local control so those mining interests get their way, and then watch the money that flows to politicians as campaign contribution and kickbacks to make it happen.

    What has happened with the Dakota Access Pipeline being rammed down the throats of those who own the land could soon be repeated on the Range.

  5. Submitted by John Ferman on 01/20/2017 - 12:41 pm.

    Iron and Steel Making Metallurgy

    Those who long for the preeminence of Minnesota iron ore need to become aware of smelting development over the past 30-odd years. The old ore pellet and coke blast furnace smelting is no longer optimal and most cost effective. The Dutch over those past years have developed the Cyclone Converter Furnace + Smelting Reduction Vessel process, known as the Hlsarna Process. It allows powder-form iron ore and coal. Other aspects of the process reduce cost and improve efficiency. Of course, the coal still needs to be de-sufurized. The US commitment to blast furnace/open hearth smelting metallurgy forestalled developing new technology.

  6. Submitted by joe smith on 01/20/2017 - 12:54 pm.

    Out of curiosity how many acres of the

    Hundreds of thousands of acres in the Arrowhead are used by the mining companies? Hint: it is way less than 1%. So for all of you who claim you would never come north to visit, unless there was wilderness, I’m suggesting you use the +99% that is truly wild. Talking to Frank Ongaro a few months back he said the only chance for the Range to get back mining was Trump. Sounds like the voters heard him.

    • Submitted by Charlene Washburn on 01/20/2017 - 07:34 pm.

      Acreage vs impacted

      While I support iron mining, it’s the non-ferrous mining in the Lake Superior watershed that gives me pause. I see no problem with ensuring – with good science – that what will be done will not affect the watershed for decades to come. But if we are concerned with the debt that we’re leaving our grandchildren, the cost of long-term remediation must be considered if we’re considering non-ferrous mining.

  7. Submitted by Ray Schoch on 01/20/2017 - 01:08 pm.

    People change

    …when what they’re doing becomes sufficiently painful. Miners in the Iron Range are hardly the only ones, or the most recent, to find themselves in an occupational field that is disappearing. Continuing to lobby and agitate for an environmentally-destructive way of life may be a short-term (i.e., a generation) success, but, given some of the proposals being put forth – I’m thinking of PolyMet, but there are others, as well – the likelihood of environmental catastrophe that could make sizable areas essentially uninhabitable for centuries strikes me as equally possible. A lot of people, me among them, would prefer not to risk the only habitable environment we have so that a small portion of the state’s workforce can continue to have gainful employment. Plenty of other people, from farriers to furniture makers, have seen their occupations transform in ways they likely never foresaw, and they had to change careers because… well… there was little or no alternative.

    Speaking strictly as someone who lives in the state’s largest urban area, I look forward to opportunities to get outdoors, and I spent a happy week a couple years ago hiking in most of the state parks along the north shore. Of course I understand that I use products that make use of the raw materials mined on The Range, and elsewhere in the state, but but the major fiscal benefits of mining flow into the bank accounts of mining company stockholders, not miners, and that’s been true for as long as mines and miners have been part of the capitalist system. it’s also just as true that there is nothing in the photo near the end of the article that appeals to me enough to want to visit that area and spend my relatively modest “tourist dollars” there. Offhand, it looks more like a course of action, and an industry, that we should avoid rather than try to revitalize.

  8. Submitted by joe smith on 01/20/2017 - 02:05 pm.

    Ray, your statement about mining not financially

    helping miners Is not true. My father was a miner without a High School degree, he had 5 brothers of which 1 had a High School degree. My uncle with the HS degree left for Mpls, my dad and his 4 brothers all worked 40 plus years in the mines, all owned their own homes, all owned trucks, boats, guns, land, sent 17 of 22 kids through college and left their kids a little something when they passed. We were never rich but we were never poor either. There was a pride I felt in watching my dad come home dirty with grease and red ore dust after an 8 hour shift. He always said take pride in cashing a check you worked hard for.

    My father along with his brothers and both of my grandfathers always said “thank God for America and the ability to get a job you can raise a family on” .. The mining companies may have made money but they also gave thousands of guys like my dad a job that allowed them to raise their family with pride and dignity Not bad for an evil big corporation!

    • Submitted by Connie Sullivan on 01/20/2017 - 04:25 pm.

      The reason Iron Range miners could finally make a family living in the mines was because of the labor unions: men who fought together to limit the companies’ will to make miners suffer real safety and health hazards for minimal wages and no benefits at all. Let’s not romanticize the industry.

    • Submitted by Matt Haas on 01/20/2017 - 05:18 pm.

      So you want

      Jobs that will allow the locals to remain uneducated, barely able to scrape by, while in all likelihood causing them to die prematurely. All the while poisoning the landscape and ensuring that mining is the ONLY job opportunity (aside from the healthcare workers to keep the “working folks” comfortable as their bodies break down in the mines). This is supposed to be a benefit to these people you profess to care about?

      • Submitted by joe smith on 01/20/2017 - 06:56 pm.

        Matt, who said miners were uneducated??

        Many of my good friends and relatives work in the mines and they are very educated. There is nothing wrong with hard honest work and only elites or ignoramuses would call folks who work with their hands uneducated!

  9. Submitted by joe smith on 01/20/2017 - 05:17 pm.

    You can look at it any way you want…

    The mining companies gave thousands of miners the ability to raise their families with pride and dignity. Ray stated the mining companies didn’t pay which is not true. Right now a shovel operator can make $110,000 a year so I guess they still pay.

    • Submitted by Matt Haas on 01/20/2017 - 10:30 pm.

      Until

      The mine shuts down, again, and they make 0, and possess no skills other than those of a shovel operator, and cannot find work. Rinse, repeat every couple years or so. Yet THIS is what you wish to build your economy around, constant uncertainty, and false promises that never “pan out” (sorry, couldn’t resist).

  10. Submitted by Aaron Albertson on 01/20/2017 - 06:05 pm.

    Something tells me they’re sadly gonna be dissapointed

    Trump probably doesn’t actually care about those jobs. Plus he probably doesn’t really have a clue on how to do it

  11. Submitted by Bill Coleman on 01/20/2017 - 10:47 pm.

    Tourism on the Iron Range

    If Twin Cities environmentalists want NE MN residents to embrace tourism as a primary economic sector, then get up there and spend money. Hiking on the North Shore is not the Iron Range. Buying gas, burger and beer on the way in or out of canoe country is not enough – stay in resorts, buy local art, etc. Also many parts of St. Louis County are considered unserved with broadband. You may want to go north to disconnect, but the local residents need modern telecom services to support tourism and other types of businesses, get an education, work from home, etc. Just as we had to do to get electricity and phones in rural places, we need to support rural broadband. Tell your metro legislators to do so! Lack of broadband is just one reason that rural folks think that they are getting the shaft. The comments in this thread indicate disdain for the people of NE MN. They know the global trends. They know mining technology. Frankly, the attitudes here are another reason they voted as they did.

  12. Submitted by Connie Sullivan on 01/21/2017 - 04:19 pm.

    Getting broadband to the rural areas of Minnesota is not something urban legislators have blocked. On the conyraryl they’re the first to recognize its value.

    It’s the Republicans who balk.. Check it out with them, ask them how many taxes they’re willing to assess themselves and us so that the far-flung can have publicly-subsidized broadband. The GOP is really a group of big spenders!

  13. Submitted by Dennis Wagner on 01/22/2017 - 09:20 pm.

    Nice Article

    Its complicated, always winners and losers. I’m sure everyone knows China has some severe steel making overcapacity, cities have leveraged their tax base on industry and now entire Chinese communities are in deep do-do as they have all this capacity and no market. Same situation only different location here on space ship earth!

    http://www.americanmanufacturing.org/blog/entry/the-global-steel-industry-is-in-crisis-thanks-to-overcapacity

  14. Submitted by Dennis Wagner on 01/22/2017 - 09:24 pm.

    PS:

    Couldn’t help but tag on: All the “Make America Great Again” hats! Made in China, Vietnam, Bangladesh. This has got to be a the greatest 101 promotional blunder I have ever seen. Talking about bringing jobs home and using foreign labor for the promotion! And these guys on the range, can’t make that “Actions vs. words” connection!

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