WTO Says U.S. Steel Duties Illegal

[machinehead]

"The World Trade Organization ruled against heavy duties on steel imports imposed by the Bush administration, saying Friday that they violate global trade rules.

 

"The European Union and seven other countries that had opposed the tariffs demanded Washington immediately lift the duties, which were supposed to protect the U.S. steel industry from cheap imports."

 

Foul

 

Like any club, the WTO will work only if its senior officers (such as the U.S.) serve as models of good behavior for the junior members. The U.S. insistence that it will appeal, and not suspend the duties in the meantime, is an ill omen.

 

Section 201 of the Trade Act, under which these duties were applied, is utterly contrary to the letter and spirit of the WTO. There is no question that it will be rejected on appeal, too. The administration knows that, and is simply playing for time.

 

Ultimately the U.S. must decide whether it's going to play by the multilateral rules, or pick up its marbles and go home. The latter stance would be bearish for world trade, and probably the best trigger one could think of for starting a new depression.

[Sigmoid Friend]

Ultimately the U.S. must decide whether it's going to play by the multilateral rules, or pick up its marbles and go home. The latter stance would be bearish for world trade, and probably the best trigger one could think of for starting a new depression.

Or just refer the matter to Rumsfeld. He knows what to do.

[machinehead]

He's got his own problems with the protectionists.

 

"A 'Buy America' amendment was passed by the House of Representatives in May as part of a defense authorization bill, requiring 65 percent of components in items bought by the Pentagon be made in the US, compared to 50 percent under current law. It would also require some components such as machine tools to be 100 percent US-made."

 

All-American defense contracting

 

I saw what Buy American requirements did in the mass transit industry. First the protected U.S. vendors became uncompetitive and braindead. All the smart people left. Then they were bought by overseas companies, who used the U.S. plants as "screwdriver" final assembly plants for their [mostly] European parts and technology.

 

'Buy American' is a tragedy for the taxpayer. But it sounds good on paper ... if you don't know nothin' about manufacturing or economics (like most lawyer/legislators).

[fumets]

In this case since it is part of Eisenhower's warned of military/industrial partnership, it acts as a tax subsidy for defense contractors and in the long run reduces quality of our military supply chain. I do not like this but would rather have it occur in this sector than in private sectors such as transportation where it impacts the greater economy more directly. I do agree that this kind of legislation is a bad example of treating (badly) the symptoms rather than the cause.

 

Interestingly enough, we may never be able to treat the cause as long as our grass roots level machine tool industry is dissapearing overseas because of economic imbalances and comparative advantages. No one here wants labor costs to drop to Chinese levels so that comparative advantage may not come back easily until our dollar does drop to depression levels. The difference is that that might actually unwind some of the economic imbalances in a natural way rather than with the pent up forces that would remain if we "picked up our marbles and went home" by dropping out out of the rules of international trade.

[Fukui-san]

He's got his own problems with the protectionists.

 

"A 'Buy America' amendment was passed by the House of Representatives in May as part of a defense authorization bill, requiring 65 percent of components in items bought by the Pentagon be made in the US, compared to 50 percent under current law. It would also require some components such as machine tools to be 100 percent US-made."

 

All-American defense contracting

 

I saw what Buy American requirements did in the mass transit industry. First the protected U.S. vendors became uncompetitive and braindead. All the smart people left. Then they were bought by overseas companies, who used the U.S. plants as "screwdriver" final assembly plants for their [mostly] European parts and technology.

 

'Buy American' is a tragedy for the taxpayer. But it sounds good on paper ... if you don't know nothin' about manufacturing or economics (like most lawyer/legislators).

Near the end of the Roman Empire, the economy was state run.

 

They started by working out how much it cost to "run" a centurion (soldier)

and worked their way back from that number on how to organized the rest of the economy.

[threadbare]

Free trade has become a complete misnomer, as Bush's recent trip to Africa illustrates. Whenever he started hooting, chimp like, about aid, the Africans responded that they only wanted the opportunity to trade freely within the WTO.

 

Free trade is a great idea, but as it's practised now, it's like "free love". Someone's getting screwed under the auspices of openness and egalitarianism. Until it actually works to advance political liberty around the world, it should be given another name. Free trade under the Bushies and other self serving political and corporate interests should be renamed "freak trade".