Posted on 06/27/2002 7:07:45 AM PDT by xsysmgr
Over the years it would be hard to find a more stalwart free marketer in the United States Senate than Larry Craig of Idaho. Craig has one of the highest National Taxpayers Union marks in fighting against big government. He has lead the charge on supply-side tax-cutting. I have worked with him and his staff on capital-gains tax reduction — which is so critical to getting the financial markets out of their 24 month-long slide.
So why in the world has Larry Craig teamed up with ultra-liberal Democrat Mark Dayton of Minnesota to sponsor a poison-pill amendment to President Bush's free-trade bill? This amendment, as the Wall Street Journal recently noted "strikes at the very heart of fast track trade negotiations." Under the Trade Promotion Authority bill, the president negotiates a trade agreement, and Congress agrees to vote up or down on the trade treaty without amending it. Without this assurance, foreign leaders are unlikely to bargain trade agreements that could be eviscerated later by the protectionist twinges that always are present among the parochial interests on Capitol Hill.
The Dayton-Craig amendment would allow Congress to reject any provision of a trade bill that weakens so-called "anti-dumping" laws. This is a really lousy amendment on so many grounds, one hardly knows where to start attacking. It clearly violates the fast track "no-amendment" policy. Once, one amendment to a trade treaty is allowed, the dam is broken. So Larry Craig's rider would destroy the whole free-trade process that is rolling along here.
Unfortunately, Craig's amendment plays to the ingrained protectionist reservations about trade agreements among congressional members. With the strong support of the labor unions and the "fair trade" lobby, it actually passed in the Senate. The anti-free-trade-and-free-markets publication The American Prospect wrote approvingly of Craig's creation: "this is exactly the kind of mischief the Senate always keeps out of trade agreements, because it gums up the works in trade accords."
President Bush has said that he will veto the trade bill if the Dayton-Craig amendment isn't extracted. Good call, Mr. President.
This amendment is also boneheaded policy. There is no worse feature to our trade laws than "anti-dumping" penalties. Dumping laws forbid foreign companies from selling products here in the U.S. for below production costs. Why in the world should that be illegal?If a Panamanian fruit and vegetable firm is dumb enough to sell us bananas at a loss, or if the Koreans want to sell us steel for below cost, why would we outlaw the importation of these products. What if the foreign companies wanted to give us the bananas or the steel to us as a gift — for free. Would we object to that as against our national interest? Moreover, best-selling author Jim Bovard has shown over and over again that when nation's "dump" products here in the U.S., the biggest winner is American consumers who get low cost goods and services. He has also shown that any time an American company that is reporting losses in a given year — as most U.S. companies did last year — exports products abroad, those firms are technically guilty of illegal dumping. After all, since they lost money, they by definition were selling goods below cost.
Anti-dumping laws reflect an "exports good, imports bad" view of trade that is economically misguided and anti-consumer. The lower the price of imports, the higher Americans' real incomes rise, because we can all buy more products for the money we make in an hour's worth of work. This is precisely why a strong dollar is good for America. It makes us richer relative to workers in other nations. I call this Kudlow's law.
So shame on Larry Craig — and I say this with great reluctance because Larry is a personal friend. But if he wants to be a friend of the American worker and our high-tech, high-wage, free-trade-driven economy, he will repudiate his destructive amendment.
To paraphrase Woody Allen: Larry, you never want to be part of a club that would have Mark Dayton as a member.
— Stephen Moore is president of the Club for Growth.
I sent the club a wire stating, Please accept my resignation. I don't want to belong to any club that will accept me as a member.Other Groucho quotes are at www.groucho-marx.com.
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