Thread: Just a five year tariff on Chinese goods

Well I wouldn't say the only problem. Who's going to finance our debt?

Originally Posted by 9aces

Well I wouldn't say the only problem. Who's going to finance our debt?

Serious question...
What would China do if we simply said what we say to Americans all the time..."Buyer Beware!".

They would probably let their attack dog on the Korean peninsula off the chain.

Originally Posted by Commodore

They would probably let their attack dog on the Korean peninsula off the chain.

China would simply execute the finance executives who allowed the bad buys and then we'd start from scratch.

Originally Posted by USCitizen

Serious question...
What would China do if we simply said what we say to Americans all the time..."Buyer Beware!".

Simple. Tell us to buy our own debt, then route their products to us through 3rd parties which would be overlooked by the people in congress paid to overlook them.

You really didn't put much thought into that question did you?

Originally Posted by Brutus

This seems like an excellent liberal idea. We can't compete with the Chinese so all we have to do is impose a tariff on the free market to protect and rebuilt all our manufacturing industries.

The only problem is that in five years our manufactured goods would be far less competitive and far less world class. Its the perfect liberal solution.

I'm not familiar with that idea, who is presenting it that you feel is so liberal?

Originally Posted by Brutus

This seems like an excellent liberal idea. We can't compete with the Chinese so all we have to do is impose a tariff on the free market to protect and rebuilt all our manufacturing industries.

The only problem is that in five years our manufactured goods would be far less competitive and far less world class. Its the perfect liberal solution.

Problem is this used to be a conservative idea. Ever read U.S. history?

THE REPUBLICANS WERE THE PARTY OF TARIFFS - THE DEMOCRATS WERE THE PARTY OF FREE TRADE. Our founding fathers were protectionists. Don't believe me? Do I have to give you yet another history lesson?

As for China and the fictional "free market":

Among the Chinese barriers the USTR ( Office of the United States Trade Representative ) identifies are:

high import tariffs (even after a recent tariff lowering),
tariff-rate quotas (a two-level set of tariffs, low for levels within quota, high for those over quota),
Import licensing,
Testing and standards,
Local content requirements,
Quarantine procedures,
Sanitary and phytosanitary measures,
Discriminatory administration of value added taxes,
Quantitative quotas,
Export licenses,
Discriminatory anti-dumping procedures,
Unpublished laws and regulations,
State licensed trading rights (import and export),
Required use of local agents to distribute imported goods,
Import substitution measures,
State certifications,
Import quality licenses,
Import commodity safety licenses,
Labeling requirements,
Hidden export subsidies,
Weak enforcement of intellectual property laws,
Distribution restricted to Chinese-owned firms,
Highly regulated transport and logistics, and
Unofficial local content requirements, among others.


Pat Choate & Edward Miller
The U.S. Industrial Base and China
A Congressional Report, 2001

http://www.usitc.gov/trade_remedy/73...2004-15-04.pdf

In summary, the Chinese are dumping. That's
been determined. The foreign-owned producers that are
not at the table today essentially are afraid to
support this case because they've been threatened by
the Chinese government, and their investments in this
industry and other industries in China. And we'll
provide additional evidence of that in the record.

David A. Hartquist
Attorney representing the IBEW, IUE-CWA, and Industrial Division of the Communications Workers of America, as well as Five Rivers Electronic Innovations, LLC, a manufacturer of color televisions
based in Greeneville, Tennessee.
Testimony before the United States International Trade Commission
In the Matter of China dumping TV sets in the U.S. market.
April 15, 2004



http://www.usitc.gov/trade_remedy/73...tion_china.htm

DEPARTMENT OF COMMERCE International Trade Administration
Notice of Final Determination of Sales at Less Than Fair Value and Negative Final Determination of Critical Circumstances: Certain Color Television Receivers From the People's Republic of China AGENCY: Import Administration, International Trade Administration, Department of Commerce. EFFECTIVE DATE: April 16, 2004.

Nonmarket Economy Status for the PRC

The United States International Trade Commission has treated the Peoples' Republic of China (PRC) as a nonmarket economy (NME) country in all antidumping investigations.

Market Oriented Industry (MOI)

In order to consider an MOI claim, the Department requires information on each of the three prongs of the MOI test regarding the situation and experience of the subject industry as a whole.

Specifically, the MOI test requires that:
(1) There be virtually no government involvement in production or prices for the industry;
(2) the industry is marked by private or collective ownership that behaves in a manner consistent with market considerations; and
(3) producers pay market-determined prices for all major inputs, and for all but an insignificant proportion of minor inputs. Additionally, an MOI allegation must cover all (or virtually all) of the producers in the industry in question.


Manufacturer.............................Dumping Margin (percent)

Haier Electric Appliances International Co................. 21.49
Hisense Import and Export Co., Ltd............................ 21.49
Konka Group Company, Ltd........................................ 11.36
Philips Consumer Electronics Co. of Suzhou Ltd........ 21.49
Shenzhen Chaungwei-RGB Electronics Co., Ltd........ 21.49
Sichuan Changhong Electric Co., Ltd.......................... 24.48
Starlight International Holdings, Ltd........................... 21.49
Star Light Electronics Co., Ltd.................................... 21.49
Star Fair Electronics Co., Ltd...................................... 21.49
Starlight Marketing Development Ltd........................ 21.49
SVA Group Co., Ltd............................................... ..... 21.49
TCL Holding Company Ltd........................................ 22.36
Xiamen Overseas Chinese Electronic Co., Ltd...... .... 4.35
PRC-wide.............................................. ...................... 78.45


As explained in the Department's Preliminary Determination, there are numerous producers/exporters of the subject merchandise in the PRC. However, as noted in the preliminary determination, all exporters were given the opportunity to respond to the Department's questionnaire. Based upon our knowledge of the PRC and the fact that U.S. import statistics show that the responding companies did not account for all imports into the United States from the PRC, we have determined that certain PRC exporters of CTVs failed to respond to our questionnaire. For this reason, we determined that some PRC exporters of subject merchandise failed to cooperate in this investigation. In accordance with our standard practice, as adverse facts available, we are assigning as the PRC-wide rate the higher of: (1) The highest margin listed in the notice of initiation; or (2) the margin calculated for any respondent in this investigation.

THE EUROPEAN UNION DOESN'T SUBSCRIBE TO LEAVING THEIR MARKETS WIDE OPEN LIKE CONSERVATIVES IN THIS COUNTRY DO

China has become one of the most significant targets in the EU anti-dumping practice. Since 1988, antidumping proceedings against China have substantially increased. Even worse from this perspective, most of the proceedings against Chinese enterprises resulted in high antidumping
duties or minimum undertakings.......

By the end of 1999, the Commission and Council had 151 anti-dumping measures and five anti-subsidy measures in force, covering sixty-three products and thirty-five countries.
Of these 156 measures, thirty-three concerned China.....These measures severely undermined the competitive capability of many Chinese industries involved, and virtually excluded them from the European market. In this sense, China has also become the most distinctive victim of the EU anti-dumping practice.

In 1988, the EU began to investigate antidumping charges brought against color televisions made in China and South Korea. The result of that investigation came out against the manufacturers, and an anti-dumping duty of
15.3% was levied on Chinese televisions beginning in 1991. In 1992, the EU launched another investigation of imported televisions, which resulted in an anti-dumping tariff of 25.6% being imposed by the Council on Chinese sets beginning in March 1995. Three years later, following the promulgation of the New Anti-dumping Rule, the EU decided that the existing tariff rate on imported sets would remain unchanged for most nations, but rise to 44.6% for those made in China. Thus, for all intents and purposes, Chinese color televisions were expelled from the European market.

Please note how much sooner the EU attacked the problem and what the tariff level reached:

44.6% TARIFF

And what tariff level did the U.S. slap on the dumping Chinese?

http://www.appliancedesign.com/CDA/Archives/0a0e3a6c89a38010VgnVCM100000f932a8c0____

Five Rivers Electronic Innovations LLC, the Greeneville television manufacturer that has filed for Chapter 11 protection with the U.S. Bankruptcy Court here, hopes by late next year to receive up to $23 million in tariffs imposed in the past year on Chinese-made TVs imported into the United States.
Tom Hopson, Five Rivers’ president and CEO, said in a creditors hearing on Monday that Five Rivers expects to receive between $8 million and $23 million from the U.S. Treasury from customs duties collected on imported Chinese television sets.

Hopson said Five Rivers expects to recover up to $23 million from the 20 percent tariffs that have been collected from the Chinese TV manufacturers since November 2003, if the U.S. government agrees with Five Rivers’ contention that the tariff was needed due to “critical circumstances” that then existed.

Hopson earlier said, “There are only seven manufacturers in the United States” that produce TVs. Five Rivers is the only American-owned one of the seven. The other six are Japanese-owned, Hopson has said.

And some more food for thought:

A World Government

Finally, if free trade is to work on a world basis, it means that we must have a world government. This follows because several of the first seven conditions (1.taxes must be comparable 2. a single monetary system must be in use 3.there must be uniform business laws 4.similar business ethics 5.uniform wage rates 6.maximum labor mobility 7.freedom from threat of war) can be met only through an over-all world government which can set uniform taxes, establish and administer uniform laws, furnish a single currency, and assure freedom from war. It is not intended here to argue either for or against world government, but rather to point out that world-wide free trade is an internationalist concept - the very premise underlying the free-trade theory requiring world government as part of the necessary conditions."

Lewis E. Lloyd
Tariffs: The Case For Protection, 1955
p. 69-72

Steve

Originally Posted by 9aces

Simple. Tell us to buy our own debt, then route their products to us through 3rd parties which would be overlooked by the people in congress paid to overlook them.

It increases the cost of business for the Chinese manufacturers, that isn't a bad thing.

Originally Posted by 9aces

Simple. Tell us to buy our own debt, then route their products to us through 3rd parties which would be overlooked by the people in congress paid to overlook them.

You really didn't put much thought into that question did you?

We wouldn't have much debt to borrow against. Did you think of that?
China stops selling us stuff we buy with their money...Ooh, I'm terrified.
Their slaves would starve and rebel just like in France and we'd get a good look into their version of an up and coming "Democracy" if they don't cut off their Internet as usual.

Originally Posted by USCitizen

We wouldn't have much debt to borrow against. Did you think of that?
China stops selling us stuff we buy with their money...Ooh, I'm terrified.
Their slaves would starve and rebel just like in France and we'd get a good look into their version of an up and coming "Democracy" if they don't cut off their Internet as usual.

You should look a bit more at Chinese history. They have a few thousand years of it to look at. Revolutions don't have a particularly good history there.

Not the same culture, not even close. We'd still have the debt too btw, we'd just be devaluing our own currency faster to fund it with currency printed in larger amounts.

Originally Posted by JDJarvis

It increases the cost of business for the Chinese manufacturers, that isn't a bad thing.

It is when it increases the costs for us for the things we'll still be buying through 3rd parties from them.

Originally Posted by 9aces

You should look a bit more at Chinese history. They have a few thousand years of it to look at. Revolutions don't have a particularly good history there.

Not the same culture, not even close. We'd still have the debt too btw, we'd just be devaluing our own currency faster to fund it with currency printed in larger amounts.

I understand Chinese culture is a rather brutal one when it comes to revolt; unlike ours.
But their culture isn't so great when way over 99% of the population is living in severe poverty conditions with NO HOPE of an out.

China does have a way to deal with lost revenue.
They bring in at least 25 million farm peasents every year to the big cities and pay them the lowest wages.
They will simply have to bring in more.

The only people in China who will REALLY suffer from us giving them the finger will be those who are wealthy anyhow; certainly not the average person.

Originally Posted by 9aces

It is when it increases the costs for us for the things we'll still be buying through 3rd parties from them.

"Those who don't know history are destined to repeat it"
Edmund Burke (1729-1797)

The French Commission, in their report of the Centennial Exposition in 1876, declared “that under the shelter of a prohibitory system the people of the United States have organized a powerful industry which rivals England in cheapness.”

The German Commission also stated that “the present condition of American manufactures show the fallacy of the free trade doctrine, that the products of a country are raised in price by Protective duties.

Before the Tariff of 1828 English axes sold here for from $2 to $4. By the Tariff a duty of 35% was levied on axes. In 1836 foreign and home-made axes were selling side by side at from $1.25 to $1.35 each, and in 1876 they sold for 80 cents each, a decrease to one-quarter of the price of 1828, as a result of home industries fostered by a Protective Tariff.

In 1840 the English furnished us our saws at from $15.75 to $19 per dozen; with a Tariff of 45% on saws they sell at from $5 to $10 per dozen, which is a saving of one-half the price of a saw to every farmer and mechanic. Beside, the superior methods which we have devised in the manufacture of saws enable us to undersell England in her own markets.

The average price of the salt per barrel, made at Saginaw during the year 1866, was $1.80, the duty being 34 cents per barrel; in 1882 the average price had been reduced to 74 cents per barrel, or but 40 cents more than the duty. Is the duty added to the price of the commodity ? Is the consumer not benefited by the Tariff which enables us to produce annually 40,000,000 barrels of salt and sell it at less than one-half its former price ?

An importer of such goods (crockery) testified before the Tariff Commission: “I have here a tumbler, known to the trade as a whiskey tumbler; six years ago, when American manufacturers commenced to make them, they were imported by the case at $1.40 per dozen; we made some, the first price was $1.25. They now sell for 40 cents.” The duty levied was 40%; as a result we have the article for 16 cents less than the duty upon the original cost before home production began. Not only has the price decreased, but a large industry has been built up which employs thousands of men and millions of capital, making a home market for our products and increasing the wealth of the country.

Before the Tariff of 1860 steel for locomotive tires cost 30 cents per pound; today, with a tariff of 2 ½
cents per pound, they are selling for 5 ½ cents. Wagon tires which sold for 16 cents per pound, with no duty, now sell for 7 cents with a duty of 3 cents per pound.

When the English controlled our market they sold us cast steel for 17 ½ cents per pound which they now sell us at 10 ½ cents, although in their near market in France they get 12 ½ cents for the same article. The reason is that the duty of 45% has so developed our industries that we control our market and fix the price 2 cents lower than it is in France, and the English must sell at our price or not at all.

When the Tariff was removed in 1846 iron rails were selling at $50; the English immediately reduced the price to $40, until our mills were closed; then they advanced the price to $60, finally to $75 a ton; between 1850 and 1854 England sold us 800,000 tons at $75; all of which we might have produced with a Tariff of $10 and kept the price down to $50, and saved $20,000,000 to American railroad owners. In 1867 steel rails sold at $166 currency, with no Tariff, we produced but 2,277 tons. In the year 1883, with a Tariff of 1 cent a pound in force for 15 years, we produced 1,500,000 tons at $40, and the importation of steel rails has decreased from 182,135 tons in 1882 to 2,395 in 1885. It is estimated that we have produced $1,800,000,000 worth of rails since we began their manufacture; this is so much added wealth to the country, which has given just that much encouragement and profit to our labor, mines, farms and other manufactures. A like increase in product and decrease in price can be shown in all departments of our iron industry.

The development of our bituminous coal beds under a Tariff of 75 cents a ton enabled us in 1884 to put out a product worth $143,700,000, much of which was sold at the mouth of the pit for $1 a ton, while the English paid $1.18 for the same grade of coal. Does this not show that it will profit a nation to grant a protective Tariff, or even a bounty, on any industry if thereby her own abundant resources may be developed ?

The Defender
Home Production
April 28, 1890


A glance at the history of prices of tin plate for twenty years past will make clear the necessity and propriety of the McKinley tariff, and, at the same time, illustrate the characteristic policy of British free trade manufacturers. "In 1873, British importers advanced the price of tin plate to $12 a box, in American markets ; and at once, American tin-plate factories commenced operations. British importers within three years reduced the price to $4.50 per box, and our mills had to shut down. When this was done British importers advanced prices to $9 and $10 per box, and under this stimulus, in 1879, American mills again started up. As soon as they were well at work, British importers again reduced the price to $4 per box ; and then made a standing offer or more properly a threat, to sell their tin plate twenty-five cents a box cheaper than the American product, no matter what the price of the latter might be. Of course, this action completely finished the American industry, and prices were at once advanced from $4 to $7 per box."

The McKinley tariff put an end to this outrage and robbery, and this fact alone is sufficient justification for its enactment.

It puts a duty on tin plate so high that it will probably soon transfer the most of that great industry to this country. Already many large plants are in process of erection, or have been completed, and are producing a superior tin plate, at Brooklyn, Pittsburgh, Chicago, St. Louis, and other places, and others will soon go up. The largest mines of tin in the world have lately been found in the Dakotas, California, Texas and Virginia ; so that it is morally certain that in the near future we shall be able to produce at home the full supply of tin and tin plate that we need, and which now amounts to over $30,000,000 in value annually,

When this is accomplished it will afford a new business that will annually pay to American labor not less than $23,000,000 ; it will require from iron ore miners not less than 1,000,000 tons of iron ore more than they now produce ; from limestone quarries 300,000 tons more of limestone ; from coal mines and coke ovens 2,000,000 tons more of coal and coke ; from blast furnaces 400,000 tons more of pig iron ; from lead mines and smelting furnaces 5,500,000 pounds more of lead ; from slaughter and packing houses 13,000,000 pounds more of tallow and oil; from chemical factories 40,000,000 pounds more of sulphuric acid ; from lumber yards 12,000,000 feet more of lumber ; and will give constant work to at least 35,000 persons. Indeed, it is already (1892) in large part fulfilled.

D. G. Harrimon
American Tariffs From Plymouth Rock To McKinley, 1892
p. 65-66

9aces, will you ever graduate from the Rush Limbaugh school of sound bite economic history?

If these aren't enough examples, I have more.....

I also have examples of what happened when free trade let foreign producers gain a monopoly and then engaged in the time honored tradition of price gouging the American producer.

But that wouldn't interest you, would it 9aces?

Steve