As President Donald Trump angles to shelter U.S. steel, American might be feeling a sense of deja vu. There’s an historical playbook for how this might pan out.

The 25 percent tariff that Trump has suggested placing on steel imports is actually less than the 30 percent temporary tariff George W. Bush rolled out in March 2002 against flat steel products, hot-rolled bars, and cold-finished bars. Bush also imposed tariffs of as much as 15 percent on other products found to be harming the domestic steel industry.

The 2002 tariffs—initially meant to phase out entirely within three years—actually ended in late 2003 as companies returned to profitability and retaliatory actions loomed. The restrictions were full of exceptions, both for countries like Canada and Mexico and for specific products. Yet they did have at least a small impact on trade, growth and, possibly, jobs. Here’s a brief review of the economic literature on what the fallout looked like.

Economic Impact

The Political Economy of Trade Protection: The Determinants and Welfare Impact of the 2002 US Emergency Steel Safeguard Measures
2005, The World Economy
Robert Read

According to one often-cited analysis, the tariffs cost almost 50,000 jobs in metal, machinery and equipment producing industries and 197,000 lost in steel-consuming industries—more than the 187,500 people employed in the steel industry as a whole. But it’s critical to note that the paper reaching that conclusion came from a pro-trade lobbying group. 

Read points out in this literature review that while a Peterson Institute analysis confirmed broadly that jobs had been lost, The American Iron & Steel Institute disputed the findings, arguing that jobs had actually been added.

What’s easier to pin down decisively: The tariffs likely cost GDP. In a mid-point analysis of the policy, the U.S. International Trade Commission found that returns to capital probably fell by $294.3 million, and the returns to labor probably fell by $386 million, Read writes. They thought that would be offset by tariff receipts, but those came in at just $294 million, he says, citing the Peterson paper. 

To be sure, $386 million would be a drop in the bucket for a $19 trillion economy, but the distributional effects are probably relevant. “Government revenue benefited significantly at the expense of falling private sector profits and wage payments,” Read writes.

Trade Impact

How Different are Safeguards from Antidumping?
2004, World Bank 
Chad Bown

Another place where the Bush policy took a bite? Trade. The policy led to a 13.5 percent reduction in the value of U.S. steel imports in targeted product categories in the year after its implementation, costing close to $700 million worth of trade relative to the previous year. The magnitude was probably “far from uniform across export sources and product categories,” because some exporting countries and many firm-specific products were exempt, according to this paper. By Bown’s estimates, imports of safeguarded steel products from foreign producers that did not receive special exclusions fell by 30 percent.

Worth noting: This was kind of the point, so it’s not a huge surprise.

Industry Impact

Steel Safeguards and Welfare of U.S. Steel Firms 
2007, Canadian Journal of Economics
Benjamin Liebman, Kasaundra Tomlin

The industry fallout overall, however, didn’t play out quite as expected. Soon after the Bush tariffs went into force, U.S. steel showed signs of improvement as prices rebounded and companies returned to profitability—but those improvements probably had little to do with the policy, Liebman writes. Instead, declining production capacity and changing macroeconomic conditions helped the industry out. Dollar depreciation and demand from China also worked to lift prices, though the latter came at a delay: Executives seemed to wait to make sure increased appetite wouldn’t be transitory.

The Relevance

It should go without saying that the steel industry in 2018 is not the same one Bush protected in 2002. China has since emerged as a major exporter, holding down steel prices worldwide. Still, the economic fallout may be similar: tiny. 

“If President Trump ends up allowing significant exclusions like President Bush did, including imports from Nafta countries, then the impact will be muted,” Liebman wrote in an email. “So that’s the big question now: Will there be exclusions and how significant will they be?”