9/15/2004

The U.S. continues its Anti-Dumping Campaign

The U.S. seems to be fighting an uphill battle with the World Trade Organization or the (WTO). This article found on the U.S. Department of the State website, discusses the issue of the dumping of foreign goods into the U.S. economy. According to the article the U.S. is continuing its fight to stop foreign countries from dumping their goods into the somewhat fragile American economy. All of this inspite of the WTO'S efforts to bring world trade.

Since 2000 when the Byrd amendment was passed the U.S. has continued to put high tariffs on dumpers and continued to subsidies those companies of whom were considered to be dumped upon. The Byrd amendment is a direct violation of the WTO code therefore U.S. is now going head to head with the WTO trying desperately to do what it feels is best for the American Worker.

I feel this is a big mistake on the part of the U.S. Any good economist can see that the dumping is only making the market more competitive, which is actually better for the consumer. The economic principle which best suits this is that of comparative advantage. I feel that the U.S. is doing its people a great injustice by not allowing these type of opportunities to enter into the U. S. Market place. Sure in the short run our economy will suffer; however, in the long run we will be able to capitalize on our neighbors advantages. Fighting the WTO will only delay the recovery of our economy. Thus it is very important the we open up the avenues of free trade and continue to support it, our very lively hood could depend on it!!

2 comments:

John West said...

I agree with Maudi. The United States should allow goods to enter the country without severely penalizing the importer's that do so. Sure there is a need for limited tariffs and subsidies, but the government should not support those companies that can't stand on their own feet after receiving time and again subsidies from the government. Such is the case with the airline indusrty. There are some companies that have gone in and out of bankruptcy courts several times.

At the same time we cannot allow for American firms to be constantly undercut by foreign firms that are given more advantages in the first place. For example say that there is a firm that manufactures a widget in a third world country where environmental regulations don't play a key role in cost considerations. That company in-turn brings those widgets into the United States at a lower price due to the fact that they cost less to make. American firms should not have to suffer because they had to follow more stringent guidelines in the manufacturing process.

Dr. Tufte said...

-3

Three spelling errors, two miscapitalizations, and one missing word.

I don't think that anyone really disagrees with the idea that dumping is anti-competitive. The problem in practice is that the firms making the accusations usually can't be trusted to be objective. This is called highjacking a regulatory process. The upshot is that you probably shouldn't trust dumping accusations.