Posted on 11/23/2005 10:35:06 AM PST by BransonRevival
Amid its disarray last week, the House of Representatives did do one good deed: It included the repeal of the anti-trade Byrd Amendment as part of its budget reconciliation. The White House is also pushing repeal, so opponents are now hoping Senators (including a Republican who wants to run for President) will keep this protectionism alive.
"Byrd" is named after West Virginia Senator Robert Byrd, who snuck it into a 2001 spending bill without debate. The amendment gives companies that sue for "anti-dumping" relief any duties that the government imposes on foreign competitors. U.S. companies that decline to join any dumping petition don't get to share in the Byrd droppings. In other words, sue for protection and get rewarded; keep your nose to the grindstone and get zilch. In political terms, it's a perpetual-motion protectionism machine.
It also violates global trade rules that the U.S. has agreed to observe. The World Trade Organization declared that Byrd was illegal in 2002, and it has authorized the European Union and seven other countries to impose retaliatory tariffs on American goods. This May, the EU did just that, slapping a 15% tariff on imports of 10 kinds of U.S. apparel. Canada, Mexico, and Japan have also retaliated.
According to a study by the Government Accountability Office, a mere five companies have collected half of the $1 billion in Byrd money that has been doled out since 2001. The biggest winner by far has been Ohio-based Timken Company, maker of ball bearings, which pulled down a staggering $52 million in 2004. Another Ohio company, candle-maker Lancaster Colony Corporation, got $26 million. This sure beats having to win market share.
The Commerce Department is holding almost $5 billion in Byrd money while the U.S. litigates multiple Nafta panel rulings that say U.S. anti-dumping duties against Canadian lumber violate that trade agreement. Fourteen Georgia companies got $321,000 in Byrd money in 2004, but 12 of those are lumber companies, awaiting the Canada decision.
Which brings us to the Senate, which didn't include Byrd repeal in its version of the reconciliation bill that now goes to conference. Nonetheless, 20 GOP Senators recently signed a letter to Majority Leader Bill Frist threatening to oppose final passage of reconciliation if it includes Byrd repeal once it returns from the House.
We're not surprised to see the signatures of Ohio Senators Mike DeWine and George Voinovich or Georgia's Saxby Chambliss on that letter. They're flacking for their home-state companies (see above) and no one will mistake them as Presidential timber. The really surprising name on the list, however, is George Allen, the Virginia Republican who has become the darling of some conservatives as they contemplate life after President Bush.
We wonder if Mr. Allen really knows what he's doing here. Byrd distributions in Virginia in 2004 totaled a mere $5.5 million. About $4.6 million went to Lafarge North America, and $924,000 to Titan America LLC -- both building material suppliers that stand to benefit from such protectionism as the 55% anti-dumping duty levied on Mexican cement.
In return for doing their bidding, Mr. Allen is cementing his own reputation as an opponent of free trade. No avowed protectionist has won the White House since Herbert Hoover in 1928 (and we know how that turned out), so backing Byrd doesn't look like a smart political strategy. Worse, it raises doubts about Mr. Allen's grasp of economic policy.
Modern Presidents of both parties have been ardent free-traders because they realize it is in the national interest. That's why Mr. Bush is now devoting a great deal of his time and diplomacy to advancing the Doha round of global trade talks. Byrd contradicts that policy, which is why a growing number of national business groups -- from home builders and construction companies to food processors and retailers -- are organizing to fight Byrd. They see both U.S. exports and consumers losing under Byrd to a handful of inefficient U.S. companies and their savvy Beltway lawyers. Which side are Mr. Allen and his GOP colleagues on?
Not I...
Free Trade PING
I see Dick Wadhams, has advised Allen to go after the Blue Collar Union vote in the Rust Belt and upper mid west where Free Trade is despised...
This is BS. If you are entitled by law to money that you fail to collect because you don't file the right paperwork, that's not "keeping your nose to the grindstone." It's missing the boat. Should foreign countries be allowed to flood our markets with artificially low priced goods?
His overall record is pro-free trade, so he can always try and pull a Kerry (nuance stuff) where he is pro-free trade but with something to show he isn't totally free trade.
Personally, its not smart politics, and makes him look like a flip flop without convictions.
"I see Dick Wadhams, has advised Allen to go after the Blue Collar Union vote in the Rust Belt and upper mid west where Free Trade is despised..."
Reminds me of George Bush's protectionism for the steel industry. He hurt the whole US economy, because so many industries depend on steel and they had to pay higher prices. I don't know if it paid off politically or not because I don't know all the states where steel is made, and I'm not sure how each state went in the election. I believe they make a fair amount of steel in Ohio, which of course narrowly went for Bush.
If Allen is pursuing such a strategy, however, not only is he being unethical, is being stupid. It is too early for such a strategy. His job now is to win the nomination. Such a strategy will only help him among registered Democrats.
So far, I'm supporting Allen. His conservative voting record is almost unbelievable.
If you let the cutomers decide....well, don't get between them and the low priced goods, its like wal-mart on the day before christmas.
Most of the people I know here in TX are now anti free traitor as well. This may have some good legs in 2008.
What is an artificially low priced good? I bought gas for $2.19 a gallon yesterday. Is that immorally low? Should I refuse to pay less than $3.00 a gallon?
George Allen ping...........
I can see the campaign slogans now, Vote for me, I'll raise your prices.
Sound like a winner in Texas?
"How do you think that will play in New Hampshire?"
I don't think it will hurt him one bit in NH, or even New York or California.
Free Trade and job outsourcing in even liberal, latte drinking states is not really very popular, while it is hugely unpopular in the rust belt where a big chunk of the swing states will be.
I know lots of liberals, independents, and Republicans at my office, and I have never met one person whose number 1 issue is demanding massive/unlimited free trade with other countries.
Now strategically, I doubt Allen would have to turn into Pitchfork Pat Buchanan to be competetive in the Rust belt. He just needs to move to the center on freetrade, like promising to renogotiate NAFTA, or put a moratorium for a few years on any major Free Trade deals.
Moving to the center on Trade, rather than the Paleo/right or Union/Left may work well in Michigan against Hillary "My Husband Invented NAFTA" Clinton.
Vote for me, I will help keep good jobs in Texas. That does sound like a winner to me.
Should foreign countries be allowed to flood our markets with artificially low priced goods?
Why not? Do you prefer to pay artificially high prices for the products you buy?
"Allen is going to use it, if need be, in Virginia"
No Allen will obliterate whatever road-kill the Democrats send up against him in 2006, and Virginia is not really a protectionist state, so being somewhat anti-free trade wouldn't help Allen much in his Senate race even if he had a strong opponent.
Makeas as much sense as a Republican advocating a .50¢/gal. gas-tax hike.
Makes
With the exception of this and a few other boards and a few talking heads on the TV, I have NEVER heard a single person defend free trade. I have heard a whole lot of vemon against it however.
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