Bush teams up with Democrat congress to slap tariffs on Chinese goods

[fushigi]

Dumbasses.

Of course, China won't put up any reciprocal tariffs on US goods, right? :rolleyes:

Mark my words, this is going to be become an economic war of attrition, and everyone's going to lose as a result, especially US workers. The sad thing is that blue collar workers will be the first ones to praise the move, not realizing that this is a political football that's about to get spiked in their faces.

With tariffs, U.S. steps up economic pressure on China Decision could trigger further protective steps against Beijing The Bush administration, in a major escalation of economic pressure on China, said Friday that it would adopt a new policy of imposing tariffs on Chinese manufactured goods on the grounds that its government subsidies violated international trade laws. The action, announced by Commerce Secretary Carlos Guttierez, was widely seen in Washington as a signal of a tougher administration approach on the issue, in part because efforts by Treasury Secretary Henry Paulson Jr. to negotiate changes in Chinese policies had produced few results. Trade with China, and the record American trade deficits in general, have become a major political issue in the new Congress, with Democrats clamoring for more vigorous action by the administration. Democrats hailed the Commerce Department's step but also vowed to keep up the pressure. "This is a long overdue change in policy," said Representative Sander Levin. Democrat of Michigan and chairman of the trade subcommittee of the House Ways and Means Committee. But he said he and colleagues would press for legislation requiring further steps forcing China and other countries to change their practices. Guttierez's announcement reverses more than 20 years of American policies on subsidies, which holds that Communist countries like China should not be retaliated against for subsidies, as market economies are, in part because it is nearly impossible to define what a subsidy is in that environment.

Of all representatives, Levin should be the first one against these tariffs, as Michigan's gross state product was second last year only to Louisiana and unemployment is killing the economy.

Idiots.

[GHook93]

Leveling the playing field will have some negative effects (rise in retail prices for one), but it is need. The US manufacturing sector has taken such huge hits the last few decades, because the Chinese and other countries like it exploit manufacture workers, like the US used to do to its worker in the 1800s and early 1900s. US companies just can't compete.

Also don't just make a blanket statement that the blue collar worker will be the most negatively effected without stated why they will be.

[fushigi]

Quote by: GHook93 Also don't just make a blanket statement that the blue collar worker will be the most negatively effected without stated why they will be.

Come on, when the reduced sales to China result in billions of dollars in lost revenues for manufacturers (don't think the government won't do it just to make a point), where do you think they'll start with cutting core costs? Management benefits?

I once attended a seminar on core cost management that referred to wages as the "lowest-hanging fruit in business."

[bishop]

tariffs always end up hurting those they were intended to protect..

here's a little snippet from the last time bush levied tariffs (on imported steel):

OpinionJournal - Featured Article

Meanwhile, the tariffs imposed a toll on the rest of the economy--in particular on steel users. U.S. manufacturers that consume steel for products ranging from cars to toasters watched domestic steel prices jump by more than 30%. The International Trade Commission, which released a report at the tariffs' September midpoint, found that in their first year the levies inflicted a $680 million hit on the U.S. economy. A study done earlier this year for the Consuming Industries Trade Action Coalition went further. It found that higher steel prices cost 200,000 American jobs and $4 billion in lost wages from February to November 2002. Those 200,000 jobs were more than the total number of people employed by the U.S. steel industry itself. That's one reason more than 200 companies and organizations representing steel-consuming and related industries sent Mr. Bush a letter last month begging for relief.

[fushigi]

Great find, B.

By definition, tariffs reduce trade; reduction of trade means not permitting countries to operate according to the laws of comparative advantage, which causes inefficiencies that - also by definition - kill jobs.

The only reasons to practice protectionism of any kind are to allow a domestic industry to develop from infancy for strategic reasons and to curry political favor. Anyone who claims otherwise is being misled by those who are engaging in the latter.

[The Decider]

Quote by: fushigi Dumbasses. Of course, China won't put up any reciprocal tariffs on US goods, right? :rolleyes: Mark my words, this is going to be become an economic war of attrition, and everyone's going to lose as a result, especially US workers. The sad thing is that blue collar workers will be the first ones to praise the move, not realizing that this is a political football that's about to get spiked in their faces. Of all representatives, Levin should be the first one against these tariffs, as Michigan's gross state product was second last year only to Louisiana and unemployment is killing the economy. Idiots.

Perhaps Senator Carl Levin of Michigan objects to China's economic subsidies of car-part exporters, the subject of a larger US case against Chinese market-distorting subsidies now before the WTO.

Tariffs are never good, but they are part of economic diplomacy. And, as you said, both America and China will be hurt--and China knows it. It's a chess move in a longer game.

U.S. files WTO case against China over export subsidies - MarketWatch

[GHook93]

Quote by: fushigi Come on, when the reduced sales to China result in billions of dollars in lost revenues for manufacturers (don't think the government won't do it just to make a point), where do you think they'll start with cutting core costs? Management benefits? I once attended a seminar on core cost management that referred to wages as the "lowest-hanging fruit in business."

Right from your article. China isn't expected to impose tariffs on American goods!

China is expected to retaliate against the American action by challenging it in Federal courts and also at the World Trade Organization, but not through imposing tariffs of its own on American goods, according to lawyers who have been representing China in the dispute.

Where is this large import of American good coming from that you claim? From your article, China is exporting a hell of a lot more good to American, then they are purchasing.

Trade has risen as an issue as the American trade gap with China reached a record $232.5 billion last year, about a third of the entire global deficit for the United States.

[GHook93]

Assistant Minister of Commerce Fu Ziying said trade surplus will stay for a quite long period of time,’ partly because China has become a manufacturing center for Western countries due to its low labor costs.

http://www.khaleejtimes.com/DisplayA...=class=stories

Now I am not saying that we cut off China altogether, but something needs to be done!

[fushigi]

Quote by: GHook93 Right from your article. China isn't expected to impose tariffs on American goods!

Of course they're not going to simultaneously take the case before the WTO and put new tariffs of their own. The appeal to the WTO is just the first step, which China may expect to win.

They won't.

And when WTO appeals fail, you better believe China will pull out the reciprocity card to strike back. Just watch.

[tinybear]

Chinese goods benefit the American public. Why are our elected representatives doing this dumb thing?

[fushigi]

Quote by: tinybear Chinese goods benefit the American public. Why are our elected representatives doing this dumb thing?

Because they want to control us. They can claim they're protecting our jobs and take a fat "commission" from their lobbyist friends while making us into jobless patsies that will harm world trade through our ignorant voting.

[bishop]

i would add, though, that china IS subsidizing many of its businesses - and these subsidies do make the use of tariffs justifiable... china has been guilty of subsidizing its manufacturing sector, as well as violating anti-dumping rules.

my preference, though, would be for this case to go through the wto first.

[fushigi]

Quote by: bishop i would add, though, that china IS subsidizing many of its businesses - and these subsidies do make the use of tariffs justifiable... china has been guilty of subsidizing its manufacturing sector, as well as violating anti-dumping rules. my preference, though, would be for this case to go through the wto first.

Of course. Two wrongs don't make a right. The right solution to Chinese tariffs is to petition the WTO to have them lower the tariffs, not give them motive and justification to raise them higher.

[GHook93]

Quote by: fushigi Because they want to control us. They can claim they're protecting our jobs and take a fat "commission" from their lobbyist friends while making us into jobless patsies that will harm world trade through our ignorant voting.

You keep spouting off results, but you still have given any valid reasons for this. I'm sure the WHITE HOUSE has some pretty good economist advising on the issue.

Also fushigi as an American working in China, you might be a little biased, don't ya think!

[fushigi]

Quote by: GHook93 You keep spouting off results, but you still have given any valid reasons for this. I'm sure the WHITE HOUSE has some pretty good economist advising on the issue.

B already made this argument succinctly before, and put up good data so I'll spare myself the effort:

Bush teams up with Democrat congress to slap tariffs on Chinese goods

Quote by: GHook Also fushigi as an American working in China, you might be a little biased, don't ya think!

Doesn't make me any less right.

[fushigi]

Update

"This action of the U.S. side goes against the consensus reached by the leaders of both countries to resolve disputes through dialogue," China's official Xinhua news agency quoted a Commerce Ministry spokesman, Wang Xinpei, as saying. "China strongly requires the United States to reconsider the decision and make prompt changes."

Interesting choice of word: requires. Actually, in the original, it would read 要求 ("yaoqiu") - demands. Not request. Not urges. Demands.

China is understandably not going to take this sitting down; this is only the beginning of what will be a bitter conflict unless the WTO can work out something.

[bishop]

china is perfectly right to demand our reconsideration.. if the u.s. wanted to actually address the issue of chinese subsidies, it would've done so by taking the case to the wto.. the wto has been exceedingly fair in ruling against countries who violate the agreed upon rules, and for those who have not broken any rules.

this is more for scoring political points, especially in advance of the coming elections. it has very little to do with our workers, since these actions have historically served to hurt workers instead of helping them. rep. levin is a democrat, up for reelection in michigan... no doubt, he's going to play to his base, using this populist vote as the example of why they should give him another term in office.

[fushigi]

Still think the tariffs are a good idea?

A Chinese company targeted by Washington for duties because of unfair state subsidies said Monday that it would fight the move, which Chinese state media denounced as a blow to delicate trade relations. <snip> The decision has put pressure on the dollar because of concern that it represents a U.S. shift toward protectionism.

Yep, one thing the Dems and Repubs are both experts at: shooting their own country in the foot.

[brien]

tariffs always end up hurting those they were intended to protect..

Bingo. US Tarrifs are usually a knee jerk reaction to political pressure here in the US.

I say if someone resents Chinese products because of their labor pool, or for any other reason, then don't buy Chinese products when possible. One may pay more for goods, if they can indeed get them, but that is the best way to reject the policies of another nation whose ideology or labor policies one rejects.

However, this is becomming more and more difficult in the world market. How much Chinese steel is in that Toyota you bought which may have been manufactured in the US but its parts are merely 40% American? There are still laws that dictate the % of American made parts for foreign cars assembled in the US. Globalization in manufacturing has radically changed the manufacturer's operations since the early 1970's. The US has more work to do in this area but more Protective Tarrifs are not the answer.

Personally I find Chinese products to be not only the cheapest but also the inferior product in the range of selections in any particular group of goods. A Chinese brake caliper may last a few months, or a year at best, depending upon the use, whereas the one made in the US will usually last a few years, depending upon the miles driven and braking applications. It almost mirrors the Japanese import situation during the 1950's when the US market was flooded with Japanese made products. In the early 1960's, it was a derisive comment if one said something was "made in Japan". Today nothing could be further from the truth. Could this the same path for China?

[fushigi]

Quote by: brien Personally I find Chinese products to be not only the cheapest but also the inferior product in the range of selections in any particular group of goods. A Chinese brake caliper may last a few months, or a year at best, depending upon the use, whereas the one made in the US will usually last a few years, depending upon the miles driven and braking applications. It almost mirrors the Japanese import situation during the 1950's when the US market was flooded with Japanese made products. In the early 1960's, it was a derisive comment if one said something was "made in Japan". Today nothing could be further from the truth. Could this the same path for China?

Right on the money, buddy. I can tell you firsthand the quality of most Chinese manufactured goods is horrendous. Why do you think my company gets so much business from big American clients? QC is in its infancy here. We have to personally select suppliers for American partners here because the overall level of craftsmanship in China is a joke. (Typical post-communist thinking - more of anything is always better than higher quality.)