Last month, the U.S. International Trade Commission (USITC) ruled in favor of a USW petition filed under Section 421 of the Trade Act of 1974. The USITC found that tariff relief was needed to urgently reduce those tire imports. Evidence showed that more than 5,100 domestic consumer tire production jobs were lost between 2004 and 2008 by the flood of Chinese tire imports that undersold producers in the United States. Domestic tire companies have announced they will close more plants and eliminate another 3,000 jobs by the end of this year.
But rising nationalism is making it harder for Chinese officials to gloss over American criticism so as to preserve an unbalanced trade relationship in which the United States buys $4.46 in Chinese goods for every $1 of American goods sold to China.
, 07.09.08, 5:06 AM ET
HONG KONG - The U.S. Commerce Department on Tuesday set final anti-dumping duties of up to 210% on millions of Chinese-made off-road tires for big trucks and other commercial/industrial vehicles. However, Chinese tire manufacturers are expected to see limited impact from the ruling amid a global shortage of such tires.
The Commerce Department found that the Chinese tires were being sold in the United States at unfairly low prices and announced final anti- dumping duties of up to 210.48%, as well as countervailing duties of up to 14%. "After a thorough investigation, the Department of Commerce has found that Chinese exporters of off-the-road tires have received government subsidies and sold at below the cost of production in the United States," said Assistant Commerce Secretary David Spooner.
He bit off more than he could chew and not now knows which way to go or what to do so it's grasp at straws in the wind.
PS it was SMOOT , not SMooth
I'm inclined to believe, and the article states this as well, that China has much more to lose in this war than America does.
I think he is thinking that he needs the unions to pass his health care bill, and that he owes them because of their help getting him elected. Or politics as usual in other words.
For Obama to single out China is one of the worst moves he has ever made.
trade deficit, much?
Except that the unions are not in play about universal health care. They're for it, period.
Thomas wrote:Except that the unions are not in play about universal health care. They're for it, period.
On reflection, maybe he's about to drop the public option and buy the union's silence about it? That would be disappointing twice over.
The International Trade Commission had already determined that Chinese tire imports were disrupting the $1.7 billion market and recommended that the president impose the new tariffs. Members of the commission, an independent government agency, voted 4-2 on June 29 to recommend that President Obama impose tariffs on Chinese tires for three years. Mr. Obama had until this coming Thursday to make a decision.
American imports of Chinese tires tripled between 2004 and 2008, and China’s share of the American market grew to 16.7 percent, from 4.7 percent, according to the United States Trade Representative. Four American tire factories closed in 2006 and 2007, and several more are set to close this year.
President George W. Bush received four similar recommendations from the trade commission, the most recent one involving steel pipe in December 2005, but he rejected all of those recommendations. Under the law, the president is allowed to accept or reject the commission’s recommendations.
Mr. Gibbs said the United States, which already imposes a 4 percent tariff on Chinese tires, would impose an additional tariff of 35 percent for one year. The tariff will be reduced to 30 percent in the second year and 25 percent in the third year. The tariff is to take effect on Sept. 26.
The trade commission proposed higher tariffs than the president actually imposed, recommending an initial levy of 55 percent.
No, we don't need a trade war, but this might be an attempt at bringing things into balance.
I would guess it was something like that as well. Except that the unions are not in play about universal health care. They're for it, period. But maybe it's something else in this general area.
FreeDuck wrote:No, we don't need a trade war, but this might be an attempt at bringing things into balance.
What do you mean, "balance"? Hollywood supplies about 80-90% of all pictures running in Germany's cinemas. Evidently they are better than German studios at making movies that Germans want to watch.
Likewise, if the Chinese gain market share in tires, it's presumably because they are getting better than American producers at making tires that Americans want on their cars.
The general point here is that trade is all about division of labor between countries. It's about having every good made in the country that makes it best.
America's trade balance in one particular market is not a helpful gauge of what's good or bad for Americans.
Either way, mark it down to "change we can believe in, but I don't really wanna." This is really, really, really stupid.