rochrome increased over 30 percent in the Japanese market during 1973. U.S. METALLURGICAL INDUSTRY CONSUMPTION OF FERROCHROMIUM Gross Weight, Short Tons 1968 1970 1971 1972 1973 1974 1969 Low Carbon 152,215 159,267 152,737 127,082 123,107 150,733 172,479 High Carbon 135,830 141,247 117,746 126,111 189,986 259,190 286,549 TOTAL: 288,045 300,514 270,483 253,193 313,093 409,923 459,028 SOURCE: Bureau of Mines Minerals Yearbook, Mineral Industry Surveys. 300,000 U.S. METALLURGICAL INDUSTRY CONSUMPTION OF FERROCHROMIUM (Gross Weight: Short Tons) 250,000 200,000 150,000 100,000 1968 1969 1970 1971 1972 1973 1974 SOURCE: Bureau of Mines Minerals Yearbook. Until recently, every major steel-producing country in the world except the United States had imposed strict export controls on chromium-bearing scrap. Recent action by the Commerce Department to restrict American exports of scrap demonstrates the critical availability problem now facing American steelmakers. Reimposition of the Rhodesian embargo would necessarily convert a serious problem into a crisis. Aside from cutting off over 60 percent of current high carbon ferrochrome imports, U.S. consumers could expect to pay highly inflated prices for the remainder that was available. In 1974 for example, the Rhodesian price of $316/ton for high carbon ferrochrome was 60 percent below the Japanese average and $50/ton below that offered by German and Norwegian producers." Intense pressure on these limited markets cannot help but drive these prices even higher. Cost escalation is serious at any time, but becomes even more so when foreign steel producers, free to evade the embargo as they have done since 1967, are able to procure their raw matrials for as much as 30 percent below the cost to American steelmakers. Although chromium accounts for an average of only 16 percent of stainless steel content, it represents fully 25 percent of the raw materials cost for stainless production. Reimposition of the embargo would give foreign producers an automatic 6 percent cost advantage over American steelmakers, a factor that would likely accelerate in the future. The penetration of foreign specialty steel into the American market would almost inevitably increase. Not only would the resulting economic impact be severe, but Rhodesian chromium would enter this market in the form of stainless steel -as it did during the sanctions period-nullifying the already dubious impact of the sanctions themselves. 56 FT 246: Imports TSUSA Commodity by Country, U.S. Department of Commerce. 57 Bureau of Mines Bull. 261-262. In a recent study published by the University of Miami's Center for Advanced International Studies, economist Roger LeRoy Miller concludes reimposition of the Rhodesian embargo would cost at least * * $300,000,000 additional per year for stainless steel consu mers 2,027,000 manhours lost in the labor market per year even if the national stockpile is released. If the stockpile is not released, lost man-hours would increase to 16,700,000. The only certain effect of the sanctions would be to injure American industry and American workers, while assuring windfall profits to Soviet chromium dealers. A bill has been introduced in the US. House of Representatives that seeks to cut America off from 67% of the world's reserves of metallurgical grade chromite ore. We urge the defeat of this piece of legislation (H.R. 1287). We have prepared this pamphlet to give in detail our reasons why. I. CHROME: A GENERAL DESCRIPTION Stainless steel is essential to a modern industrial society due to its ability to resist corrosion. Over half the chrome used in America ends up in stainless steel. As the National Materials Advisory Board states: "It should be emphasized that for its major use - stain less steel-chromium is unique; unlike nickel or molybdenum which have alternates to perform the desired function, there is no other element which can be used as a substitute for chromium. Stainless steel cannot be made without chromium. In terms of chrome the U.S. is a "have-not" nation. Our reserves are so small as to be practically worthless, and as a result we have to import almost 100% of our needs. 2 Ofthe chrome used in America 23% ends up in construction. 17% in transportation, 16% in machinery and equipment and 15% in refractory products. What the Mideast is to oil, southern Africa is to chrome, only more so. The Republic of South Africa has 74% of the world's chrome reserves, followed by Rhodesia with 22%. However, the majority of the world's reserves of metallur gical chrome, the kind most economical for the production of stainless steel, are in Rhodesia with 67%, followed by South Africa with 22% and the Soviet Union with 6% 4 Chrome is more heavily concentrated in one area than any other major mineral on earth. II. THE MORAL FOUNDATIONS OF THE U.N. SANCTIONS Rhodesia is the only country in the world facing U.N. sanctions. Thus, if the UN is to be our moral yardstick, as some in America claim it should be, Rhodesia must be seen as the worst nation on this planet. Yet is this really the case? Secretary of State Kissinger has stated that the Soviet Union is no closer to democracy than Rhodesia. 5 According to Dr. Andrei Sakharov, the father of the Soviet HBomb, there are 1,700,000 people in Soviet concentration camps today. Alexander Solzhenitsyn has charged that much of the Soviet mining industry, if not all of it, was built by slave labor, and no western observers have been allowed to visit the Soviet chrome mines to verify that this is not the case right now. As for South Africa, even the violently anti-Rhodesian Manchester Guardian has stated that "Rhodesia's iniquities" "are only a pale reflection of those in South Africa. The London Economist says of black Rhodesians: "They are certainly better off financially than most black Africans south of the Sahara and, except for South African goldminers, they earn more money in real terms than the black South Africans. So much for the "superior" morality of the other two main sources of chrome in the world. A look at the rest of the world is also in order to put the U.N.'s code of morals in clearer perspective. According to Hal Sheets of the Carnegie Endowment for International Peace General Amin of Uganda has murdered 90,000 of his own citizens since coming to power in 1971. 10 The UN. has found nothing wrong with this In July "Big Daddy" Amin is scheduled to become Chairman of the Organization of African Unity. 11 On March 14, 1974 columnist Jack Anderson reported that the government of Burundi "over the past two years has engaged in mass genocide on a scale the world has not seen since Adolf Hitler tried to wipe out the Jews in World War II 12 The UN found nothing wrong with this. The UN also found nothing wrong with the fact that the majority of Burundi's citizens, the Hutus, were ruled by another tribe, the Tutsi, which excluded them from the government as well as killing them. 13 In December 1973 the UN. General Assembly endorsed a resolution proposed by Burundi which condemned Israel for "racism" 14 In the Mideast the UN has yet to find anything wrong with the atrocities of Arab terrorists. It refused to condemn the massacre of the Israeli athletes in Munich. It refused to condemn the murder of 18 unarmed civilians at Qiryat Shemona. It refused to condemn the cold-blooded slaughter of 16 Israeli schoolchildren at Maalot. When the UN spoke out on violence in the Mideast it was to condemn the Israelis - not the terrorists. On April 24, 1974 the UN Security Council passed Resolution 347 condemning Israel for raiding camps used by terrorists in Lebanon Under orders from President Nixon the American ambassador cast an affirmative vote for this proposal. 16 Was Mr. Nixon expressing the wishes of the US Congress in voting as he did? Does Congress now have a "commitment to condemn Israel? Should Congress feel a "com mitment to the U.N. sanctions against Rhodesia because President Johnson voted for them in 1966? Shouldn't the U.S. Congress feel free to judge issues on their own merits? Isn't it time the U.N. was made to impose a consistent code of international law? Isn't it time the U.N. was made to honor the principles of its own charter rather than hailing people like Yassir Arafat, who just recently claimed "credit" for the murder of 16 tourists in a small Tel Aviv hotel? 17 Until the U.N. does live up to its own charter, do we really have to go along with the Security Council Resolutions such as Number 347? Do we really have to punish our own economy by buying chrome from the Soviet Union at inflated prices "because the U.N. says so"? III. SANCTIONS: AN EFFECTIVE METHOD OF DIPLOMACY? Sanctions do not have a good record of accomplishing their goals. Napoleon's Continental System failed to break Britain. The League of Nations sanctions against fascist Italy drove Mussolini closer to Hitler rather than out of Ethiopia. In our time the two best examples of sanctions are Cuba and Rhodesia. In both cases they failed. Castro still rules Cuba. There are no serious elections. Civil liberties are nonexistent as at the beginning of the blockade. Ian Smith still rules Rhodesia. The 200,000 whites who support him are no more inclined toward surrendering their power than they were in 1967. He recently won reelection by a landslide. In both these cases the "moral" foundations of American policy have been, at best, questionable. We have continued to trade all the while with nations whose internal policies are just as foreign to our concept of democracy as those of Cuba and Rhodesia. Other nations did not take either sanctions campaign very seriously. According to The Economist of London black African states such as Zaire, Zambia and Botswana continue to trade with Rhodesia. 1 On April 18, 1975 the London Daily Telegraph stated flatly that "Russia entered the international black market for Rhodesian chrome in 1972." 19 Fortune magazine reported in 1971 that even the People's Republic of China was importing large amounts of Rhodesian chrome. 20 A recent U.N. report accuses Japan of importing almost 200,000 tons of Rhodesian chrome in 1972.21 The South African Rand Daily Mail pointed out in December 1974 that Japanese and French cars were cheaper in Rhodesia than in South Africa. 22 On June 30, 1973 the respected Africa Research Bulletin of London reported evidence of massive sanctions breaking by West Germany, Japan, Austria, Belgium, Israel, Norway and Denmark. 23 As for the Cuban sanctions, they were considered such a joke by the international community that even Fascist Spain continued to trade with Castro. By supporting the sanctions America has hurt its own economy and thus the U.S. consumer. Our refusal to buy chrome from Rhodesia forced us to turn to the Soviet Union. The Russians took advantage of this situation to not only raise their prices but to actually lower the quality of their exports.24 Our refusal to buy sugar from Cuba caused us to buy sugar from the Philippines at a much greater cost. The repeal of the sanctions against Cuba as called for in Representative Harrington's bill (H.R. 2681) would bring down the present high price of sugar. The repeal of the sanctions against Rhodesian chrome in 1971 did the same with that material. 25 The use of trade as a weapon has tended to antagonize rather than intimidate those against whom it has been used. We have quite rightly objected to the Arabs use of this tactic in their campaign against Israel. Does it make much sense for us to turn around and use it against Cuba and Rhodesia? Shouldn't American foreign policy be talking about scrapping sanctions against foreign countries rather than imposing them? Can the American consumer really afford to pay for this kind of diplomacy? IV. IS THE SOVIET UNION A RELIABLE SOURCE OF SUPPLY? Assuming we are not going to boycott the three major chrome nations because of our differences with their internal policies, it seems logical to examine the chrome question from a practical point of view. Is the Soviet Union a reliable trading partner? In December 1974 the National Security Council and the Council on International Economic Policy stated that the Soviet Union could not be counted on to maintain a continuous flow of chrome ore to the U.S. 26 According to U.S.News and World Report in 1972, the Soviets had, by that time, broken 24 out of the 25 agreements signed with us during the seven previous summit meetings. 27 In 1973 they broke within months their promise at San Clemente to keep the peace throughout the world. Not only did they fail to warm us of the impending Mideast war but once it began, the Politburo sent out messages urging other Arab states to join in the fray against Israel. 28 Radio Moscow rejoiced at the Arab oil em bargo and encouraged them to keep it up as long as possible.29 The Russians even threatened their own oil embargo against Iceland unless it closed down its vital NATO airbase.30 Meanwhile, as Newsweek put it, "The only country besides the United States that offered Israel aid was the government of South Africa." 31 Thus, the recent mideast crisis found South Africa and the United States on one side and the Soviet Union on the other. Is it not fair to conclude from their recent behavior that South Africa is a more reliable source for a strategic raw material than the Soviet Union? Does it make sense to regard the Soviet Union as a more reliable trading partner than Rhodesia, a country which offered us material support during our dark days in Vietnam? From a practical point of view wouldn't it make more sense to end chrome imports from the Soviet Union if we are going to implement a boycott? V. THE CHROME STOCKPILE: CAN WE AFFORD TO DUMP IT? Backers of H.R. 1287 claim that America can afford to end chrome imports from Rhodesia because we have an overabundance of this mineral in our strategic stockpile right now. To substantiate this argument they point to Richard Nixon's plan to reduce the U.S. stockpile of metallurgical grade chromite ore to 445,000 tons. They do not mention that Senator John Sparkman, Chairman of the Joint Con |