WASHINGTON -- While in Pittsburgh, a sense of seemliness should prevent President Barack Obama from again exhorting the G-20, as he did April 2 in London, to be strong in resisting domestic pressures for protectionism. This month, invertebrate as he invariably is when organized labor barks, he imposed 35 percent tariffs on imports of tires that China makes for the low-price end of the market. This antic nonsense matters not only because of trade disruptions it may cause, but also because it is evidence of his willowy weakness under pressure from his political patrons.
In 2000, as a price of China's admission to the World Trade Organization, Congress enacted a provision for "relief from market disruption" to American industries from surges of Chinese imports. Actually, American consumers cause "disruption" in American markets when their preferences change in response to progress -- better products and bargains. Never mind. Congress said disruption exists whenever imports of a product "like or directly competitive with" a U.S. product increase "rapidly" and threaten "significant" injury to a U.S. industry. Evidence of disruption includes the volume of imports of a particular product, the effect of imports on the prices of competing U.S. goods, and the effect on the U.S. industry.
Notice that China need not be guilty of any wrongdoing: It can be punished even if it is not "dumping" -- not selling goods below the cost of manufacturing and distributing them. (That we consider it wrongdoing for a nation to sell us things we want at very low prices is a superstition to be marveled at another day.) And China need not be punished: Presidential action is entirely discretionary. So Barack Obama was using the sort of slippery language that increasingly defines his loquacity when he said he was simply "enforcing" a trade agreement.
None of the 10 manufacturers who comprise the domestic tire industry sought this protectionism. Seven of the 10 also make tires in other countries. Most U.S. manufacturers have stopped making low-end tires, preferring the higher profit from more expensive models. (Four U.S. companies make low-end tires in China.)
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