What is “trade cheating”?: An examination of China and illegal dumping.
by Ohio Freedom
on December 14, 2016[ Crista Huff| December 13, 2016 |Goodfellow]
Promptly upon the December 11, 2016 expiration of certain World Trade Organization (WTO) Accession Protocols, China requested that the U.S. participate in WTO consultations. China is protesting being labeled a “non-market economy” (NME) by the U.S. The U.S. Commerce Department countered that expiration of the Accession Protocol does not automatically grant China market-economy status. If the consultations do not yield satisfactory results within 60 days, China can then formally proceed with a WTO dispute resolution process.
An NME usually operates with substantial government control of industry, and price-fixing. A government can afford to sell products at a loss, because it has vast financial resources to draw from. In a free market economy, a company is required to sink or swim on its own, without infusions of capital from the government.
When companies within free market economies compete against companies within NME’s that sell their products at below-market prices (a.k.a. illegal dumping), they are put at a serious disadvantage; not unlike when Olympic athletes are forced to compete against athletes who ingest illegal performance-enhancing drugs. In both cases, the playing field is not fair, and the legal practitioner has the odds stacked against them.
When Americans hear vague stories about “trade cheating” harming the economy, illegal dumping is just one of many such practices that directly result in American job loss and lower GDP.
When an American company loses market share due to dumping, there is no easy work-around without WTO intervention; no acceptable way to solve the problem that leads to continued profitable product sales. If the American company lowers its product prices to the level of the Chinese product prices, then the American company loses money. There is no benefit in selling products that deliver a net loss for a company. If the American company therefore stops selling the money-losing product, or continues to sell the product at a loss, there is less revenue and less profit at the company. When a company’s budget is cut, it therefore has to cut expenses, which invariably leads to worker layoffs, because salaries are a big expense. In more extreme situations, pricing on the American company’s entire product line can be undercut by foreign competition, driving the American company into bankruptcy. This situation is playing out right now within the American steel industry, where production fell 27% in 2015.
China is currently being investigated for its dumping practices; selling products in the U.S. at prices below fair market value. During the dispute resolution process, it makes a big difference if the defendant country is labeled a market economy or a non-market economy. NME’s are more likely to be involved in unfair trade practices, and therefore are treated less favorably during dispute resolution than are market economies. Specifically, the calculations used to determine fair pricing are more liberally applied to the benefit of the market-economy country than to the NME country. China is therefore protesting its NME label, with the goal of being labeled a market economy, and thereafter receiving lesser penalties over its dumping practices.
This week marks the 15th anniversary of China’s membership in the WTO.
Ridiculing the White Working Class Voter, and Other Trade News from
Crista Huff — November 30, 2016
Posted by Crista Huff on Nov 30, 2016
I’ve been shocked to see liberals on Twitter aggressively ridiculing the “white working class voter”. Is this about the Twitter libs being bigoted against white people, or about them expressing class superiority, or about them hating Republicans and/or people who voted for President-elect Trump? Were the libs previously embracing white working class voters because they needed their votes, and now they’re revealing their true colors? No matter how you slice and dice it, it’s extremely bigoted behavior. Would these people go into a supermarket and ridicule the cashier? Would they stop by a roadside work area and ridicule the guy who’s holding the “STOP” sign? Would they drive up to a toll booth and ridicule the tolltaker? How about warehouse managers and assembly line workers and janitors?What takes place in the mind of an American when they feel emboldened to express public disdain for vast segments of the population? Why is there no “gut check” telling them that such bigotry is wrong, and that vocalizing bigotry simply doubles down on their shameful impulses?Are we, as a society, just a couple years away from more overt and individualized persecution?
A SURGE IN CORPORATE EMPLOYMENT PLANS WITHIN THE U.S.President-elect Trump will travel to Indiana on December 1 for Carrier’sannouncement that it will not move its Indiana operations to Mexico. Carrier is a division of United Technologies. (Bloomberg, November 29, 2016)After a discussion with President-elect Trump, Ford Motor Companyannounced that it will not move its Lincoln automobile manufacturing plant from Kentucky to Mexico. (Breitbart, November 18, 2016)Taiwan-based Quanta Computer has announced that it expects its U.S.-based manufacturing business to expand under a Trump presidency. Quanta makes data center servers, in Tennessee and California, for big-name tech companies. (Nikkei Asian Review, November 29, 2016)Foxconn Technology Group, an assembler of iPhones for Apple Inc., is considering shifting some production from Taiwan to the U.S., after a June request to do so by Apple. (Nikkei Asian Review, November 18, 2016) “He tweets every day. We don’t know what’s going to happen, but things are going to happen and traders like that.”— Chew Sutat, a senior executive at Singapore Exchange Ltd., re: President-elect Trump,(Bloomberg, November 29, 2016)
COMMERCE SECRETARY CANDIDATE
President-elect Trump has chosen Wilbur Ross as his candidate for Commerce Secretary. Ross has a background as a banker, and as a private investor who restructures failing companies. In a November 30 CNBC interview, Ross discussed the need to negotiate better trade deals for the U.S. in order to increase our exports. “There’s sensible trade. And there’s dumb trade. We’ve been doing a lot of dumb trade, and that’s the part that’s going to get fixed.”
KORUS South Korea’s Minister of Trade, Industry and Energy Joo Hyung-hwansaid that South Korea “is willing to be more ‘flexible and complementary’ by further hearing out the U.S.’ suggestions” on the U.S.-Korea Free Trade Agreement (KORUS). (The Korea Times, November 29, 2016) NAFTA“Officials from both Mexico and Canada have said they are open to discussing renegotiating the agreement with the Trump administration.” — Inside U.S. Trade, November 29, 2016“Mexico’s new ambassador to the U.S. says the country is prepared to ‘modernize’ the North American Free Trade Agreement and wants to restart a guest-worker system that could address concerns about illegal immigration.” -- Arizona Daily Star/Tucson.com, November 29, 2016
TPP The Japanese Diet (its governing body) has extended its legislative session by two weeks, through December 14, in order to address the Trans-Pacific Partnership (TPP) trade agreement and pension reform. The ruling party wants to pass the TPP. Opponents have a variety of economic concerns, and also express the seeming-fruitlessness of ratifying the TPP, from which the U.S. apparently plans to withdraw in January 2017. (Nikkei Asian Review, November 28, 2016) Senate Finance Committee Chairman Orrin Hatch (R-UT) told reporters, “I supported NAFTA. I don’t think there’s any of these particular national or international agreements that are perfect, and we’ll have to see what [Trump] says. … we need to reassess our whole free trade area … if you can’t do full TPP let’s at least enter into an agreement with Japan.” --Inside U.S. Trade, November 29, 2016
TTIP Jeppe Kofod, a Danish Member of the European Parliament “said that low growth and investment in Europe underline the need for the U.S. and EU to continue to deepen their economic relations. ‘Europe has too low growth, too low rate of investment in the economy and of course too high unemployment.’ ” -- Inside U.S. Trade, November 29, 2016Does the EU sound like it’s planning to seek balanced trade with the U.S.? Or does TTIP portend trade deficits with new partner countries?
WTORoberto Azevedo, Director-General of the World Trade Organization(WTO) gave a speech on November 28, 2016, making the following comments:“[R]ecent political developments will also have an effect on the trading landscape — from the Brexit referendum in the UK to elections in many major economies … all of this is taking place amid a rise in anti-globalisation discourse in many countries and communities. [W]e must ensure that the gains of trade are better shared across society.” * * * * *
Crista Huff is a stock market expert and a conservative political activist. She works with End Global Governance and economic issues groups to defeat the Trans-Pacific Partnership trade agreement. She is also Chief Analyst at Cabot Undervalued Stocks Advisor. Send questions and comments to firstname.lastname@example.org.
Thursday, 20 July 2017
NAFTA Renegotiation Objectives Would Diminish U.S. Sovereignty
Written by Steve Byas
During his successful bid for the White House, President Donald Trump gave hope to many Americans that he was going to — as he put it himself — “put America First” when it came to trade deals, including the North American Free Trade Agreement (NAFTA). Trump called NAFTA “the worst trade deal maybe ever signed anywhere, but certainly ever signed in this country.”
This week, U.S. Trade Representative (USTR) Robert Lighthizer released the renegotiation objectives for a new NAFTA deal, and a close look at those objectives raises many concerns from Americans about U.S. business and jobs, and most critically, American national sovereignty.
The first renegotiation meetings are scheduled for August 16-20 in Washington, D.C.
In the introduction to the “Summary of Objectives for the NAFTA Renegotiation” released this week, we read, “Since the deal came into force in 1994, trade deficits have exploded, thousands of factories have closed, and millions of Americans have found themselves stranded, no longer able to utilize the skills for which they had been trained … In June 2016, then-candidate Donald J. Trump made a promise to the American people: he would renegotiate NAFTA or take us out of the agreement.”
Faced with that binary choice, it is not surprising that globalists chose renegotiation.
“The new NAFTA must continue to break down barriers to American exports,” the introduction continues. “This includes the elimination of unfair subsidies, market-distorting practices by state-owned enterprises, and burdensome restrictions on intellectual property.... Most importantly, the new NAFTA will promote a market system that functions more efficiently, leading to reciprocal and balanced trade among the parties.”
Sadly, nothing is said about protecting the national sovereignty of the United States.
Perhaps the closest the summary of objectives comes to addressing the sovereignty question is in the section about “Sanitary and Phytosanitary Measures (SPS).” In this section, it is asserted that it will be made “clear that each country can set for itself the level of protection it believes to be appropriate to protect food safety, and plant and animal health in a manner consistent with its international obligations.” On first glance, this appears to acknowledge that each nation is “sovereign” in making the decisions it believes it needs to make in regard to the level of protection for “food safety,” but it then contradicts that very statement by asserting it needs to do so “consistent with its international obligations.”
In other words, this would obligate the United States to following “international obligations,” which would supersede decisions made independently by the United States government, through its constitutional processes.
In the section on “Technical Barriers to Trade (TBT),” the objective is even more explicit in subordinating the parties, including the United States, to international obligations. The first objective in this section would “Require NAFTA countries to apply decisions and recommendations adopted by the WTO [World Trade Organization] TBT Committee that apply, inter alia, to standards, conformity, assessment, transparency, and other areas.” (Inter alia is a Latin phrase meaning “and other things,” and in this context, would mean that the United States, Canada, and Mexico would be further obligated to follow economic regulations of the WTO.) Again, this is a further limitation on American national sovereignty.
References to following the sovereignty-restricting rules of the WTO permeate the listing of objectives.
While multilateral trade agreements generally are presented as somehow based on the concept of “free enterprise,” they are actually better examples of government-managed trade, and NAFTA as it is presently constituted, and under these objectives, would continue to give power to government (in this case, a multinational government) to regulate private enterprise.
For example, the objectives would “Require NAFTA countries to have laws governing acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health.” A true conservative free market advocate would not even consider government price controls (as in the case of minimum wages), knowing that they lead to market distortions. With minimum wages, for example, it leads to a surplus of labor and presents a barrier to the work force for many low-skilled and inexperienced workers. Why should this be part of a new NAFTA agreement, if its purpose had anything to do with free markets?
The globalist philosophy in these objectives is very clear, as it states that a new NAFTA will “establish rules that will ensure that NAFTA countries do not fail to effectively enforce their labor laws implementing internationally recognized core labor standards and acceptable conditions of work with respect to minimum wages, hours of work, and occupational safety and health laws.” (Emphasis added.) In other words, if you understand that OSHA in the United States is a prime example of government control of private business, why would you want international “standards” placed on the backs of business?
Globalism is a concept that is ubiquitous in the objectives. Under “Environment,” this philosophy is evident: “Require NAFTA countries to adopt and maintain measures implementing their obligations under select Multilateral Environment Agreements (MEAS).”
Larry Greenley, director of missions for The John Birch Society, parent organization of The New American, issued the following statement today regarding USTR Robert Lighthizer's "Summary of Objectives for the NAFTA Renegotiation":
Beware when you read anything from the United States Trade Representative (USTR) about the NAFTA renegotiations. The USTR will portray these negotiations as all about trade and jobs; however, what’s really at stake is our national independence and personal freedom. For example, the USTR’s “Summary of Objectives for the NAFTA Renegotiation” appears to be all about “maintaining and improving market access for American agriculture, manufacturing, and services,” when it is actually all about creating a supranational level of government, commonly referred to as the North American Union, which would administer and enforce the myriad rules contained in the “new NAFTA” agreement. This is the kind of deception that was used to transform the European Common Market from a free-trade bloc into a supranational European Union presiding over 28 formerly independent European nations.
In short, rather than renegotiate NAFTA, a classic example of multinational government-controlled trade, it would be better to simply scrap the agreement altogether. The John Birch Society is urging its members and all other citizens concerned about the loss of America’s independence to contact the White House and Congress and “tell them no renegotiation, just Get US Out! of NAFTA.”
The Trans-Pacific Partnership, explainedEdited by Timothy B. Lee
The Trans-Pacific Partnership is a pending trade agreement among countries bordering the Pacific Ocean, including the United States, Japan, Vietnam, Australia, and Chile.