Monday, March 29, 2010

Monday Quick Hits

A few noteworthy items for those of you whose brains weren't fried by yesterday's WTO analysis:
  • Crappy Anniversary!  On the six month anniversary of President Obama's bad decision to impose tariffs on Chinese tires under Section 421 of US trade law, Reps. Kevin Brady (R-TX) and Dan Boren (D-OK) have sent a letter to President Obama asking him to report on the economic impact of the controversial trade measures (hint: it hasn't been pretty).  As you'll recall, Brady and Boren sent USTR a similar letter back in January and apparently were totally ignored (shocking, I know).  Money quote: "This tire tax affects all Americans—workers, distributors, retailers, and consumers.  Fortunately, the law gives the President the opportunity to review the tax after six months to see if it is working or not. In January, Congressman Dan Boren and I wrote to the Administration and asked for confirmation that it has a system to collect the full range of information so that the President can fairly assess the impact of the tax on all Americans. Regrettably, no such system is in place."  I'm sure it was just an oversight, Congressmen!  Surrrrre.  National Journal reports, however, that Ways & Means Democrats remain opposed to such sanity and transparency, calling the tire tariffs "one in a series of actions he has taken to enforce trade laws," and urging Obama to "do more to address the trade gap with China...."  As we all know, both the "421 as enforcement" and "trade deficit" assertions are utter nonsense and should be treated as such.  But they do provide yet another example of the Democrats' reliance on these two classic protectionist myths.  Broken records, these guys.
  • China currency sanity exists; you just need to know where to find it.  For those of you who still want more good stuff debunking the absurdity coming from many of our elected officials and pundits on China's currency policies, I recommend the following: Stanford's Ronald McKinnon drops some serious knowledge on a stable yuan-dollar exchange rate and the yuan and the trade balance;  Reuters' John Kemp on global imbalances and the "Triffin dilemma" (a year old but still good); and AEI's Mark Perry on that dastardly currency manipulator that is, err, Hong Kong?
  • Is the US really ending "zeroing"?  Washington Trade Daily reports (no link) that "The United States is finally giving up the battle with the World Trade Organization over the continued use of the controversial 'zeroing' methodology in calculating antidumping duties, US Trade Representative General Counsel Tim Reif said on Friday....  Speaking at a meeting of the Society for International Law, Mr. Reif said he still believes that the WTO is going beyond the bounds of Article Two of the [Anti-dumping] agreement, but said USTR now is working interagency to administratively correct the 'zeroing' issue and bring the United States into compliance."  As you may recall, US officials said similar things at an early-March WTO meeting (and were met with skepticism by me and everyone else).  However, this is now the second time that the US has publicly stated, without subsequent retraction, their desire to finally comply with multiple WTO rulings against the controversial practice, so maybe Reif & co. actually mean it.  I've complained loudly for months about US refusal to stop zeroing in administrative reviews, and how that refusal could end up costing US exports billions in WTO-authorized retaliation, so if this turns out to be true, it's a very welcome development and deserves to be praised.  The proof, however, will be in the interagency pudding.  So stay tuned.
Exit question: given that the United States was endlessly litigating (and losing) WTO disputes on its zeroing practices in order to maintain its negotiating position in the WTO's Doha Round that WTO rules should be changed to expressly allow for zeroing, does the change in US position signal that USTR has totally given up on Doha?  Cripes.

No comments: