Good editorial in the Los Angeles Times today, on the rhetoric versus reality of Obama's trade policies. The paper says Obama's record on trade has so far been "incoherent". The G20 (meeting today and tomorrow in Pittsburgh) is an opportunity for Obama "to clarify his approach" to trade issues".
"If tariffs are such a good economic idea, then why stop at national boundaries? If they make everyone richer, why not have customs posts between New York and New Jersey? Cars entering and leaving the Lincoln tunnel would have to pay, on top of the toll, a surcharge on all the goods they contain. Why not, indeed, make New York and New Jersey self-sufficient in all their needs, making all their own cars, growing all their own food etc?"
London and Pittsburgh – The global Freedom to Trade Campaign today challenges G20 leaders convening in Pittsburgh to focus on the biggest threat to economic recovery and long-term prosperity: escalating protectionism.
In November 2008, the G20 recognised that freedom to trade is essential to the global recovery, pledging to “refrain from raising new barriers to investment or to trade in goods and services” for 12 months. Yet, since then all 20 nations have broken this promise, on average, once every three days.
Daniel Ikenson, author of "No Longer Us versus Them - trade policy for the 21st century" and Alec van Gelder of International Policy Network argue that:
This global factory has changed the old “Us versus Them” characterisation of international trade for good--and for the good. Trade is increasingly the process of importing a good, adding value to it, and then exporting it to another producer further down the production chain. These complicated production and supply chains rely upon the rapid flow of goods and services across borders.
Banning containerised shipping (perhaps the most important technique in 20th century trade) or broadband Internet connections (which have paved the way for millions of call-centre jobs) would clearly be ridiculed.
Yet it is equally ludicrous for governments to promote “temporary” tariffs to shelter “domestic” industries, or subsidies for “local” producers, or “environmental” regulations that hobble foreign competitors.
From The Economist:
FORD makes transit vans in Turkey, with passenger seats in the back. When the vans are shipped to America, the brand-new seats are immediately torn out and recycled.
Why? Because 46 years ago, Europe slapped tariffs on American chickens. America retaliated with a tax on European commercial vans.
Check out this new Freedom to Trade interview with Daniel Ikenson, who explains how President Obama's decision to implement a 35 per cent tariff on imports of Chinese tyres is tantamount to economic vandalism -- and that's about it for the good news.
The Freedom to Trade Petition has now been translated into Hindi! That makes 32 languages! Stand up to the protectionists around the world by signing the petition, and please encourage your friends to do the same.
Later this week, the F2T campaign will head to Pittsburgh to make the case for free trade -- and against protectionism -- during the G20 meeting of world leaders. Campaign materials will be available on this website, and will be distributed by campaign representatives in Pittsburgh.
This Wall Street Journal editorial explains brilliantly the reasons why Obama's terrible decision to implement tariffs on Chinese tyres matters so much, how it represents a colossal step in the wrong direction.
"Leaders of the world's 20 top economies vowed to resist protectionism last November and again in April as they charted a joint strategy for confronting the worst global downturn in generations. As they meet again, they'll get this progress report: Most of their economies are on the mend — and trade tensions and protectionism are on the rise."