Tuesday, March 16, 2010

Tuesday Quick Hits

Lots of hit-worthy stuff over the last few days:
  • Well, that sure didn't last long.  Last week I expressed serious* concern about our beloved United States Trade Representative because he had uncharacteristically ditched his longstanding mercantilist rhetoric and was bizarrely evincing a rare moment of import-loving clarity.  Well, fear not, dear readers!  Ron Kirk was not - I repeat NOT - abducted by economically-literate aliens.  According to multiple news reports, after blurting a litany of scripted sanity, Amb. Kirk immediately slipped back into his import-hating fog, reflexively poo-pooing a bill that would unilaterally reduce tariffs on imported footwear: "Kirk told the [audience] that with respect to trade-related issues the administration’s focus is on increasing exports, not imports. 'It’s hard to look at our trade deficit and the openness of our economy and make a compelling argument to the American public that we don’t have enough imports'.... In addition, Kirk said, the administration believes that an effort to lower tariffs on imported footwear is more likely to be acceptable to Congress in the context of a multilateral agreement like the ongoing Doha round where the U.S. would get something in return. Given that the benefits of duty elimination would flow almost entirely to one country (which is undoubtedly China even though Kirk did not mention it by name), Kirk said, it would be politically difficult to persuade lawmakers to grant such a concession unilaterally."  Now that's more like it, Ambassador!  Of course, there's one tiny, technical problem with this statement: as even your basic college freshman knows, China would reap the second-most benefits from this bill.  The United States (particularly lower-income American families) would reap the biggest share of benefits (i.e., half of them) through lower prices for a basic necessity - shoes.  I guess Kirk wasn't kidding about not "focusing" on imports, huh?  (Clearly, the aliens have left the building.)
  • Maybe, just maybe, American manufacturing isn't the pathetic loser that our politicians allege.  Courtesy of economist Mark Perry: "The Federal Reserve reported today that Industrial Production increased in February by 1.7% compared to the same month last year, the largest increase since the 2.2% gain in January 2008. The February gain followed a year-to-year increase in industrial production 0f 0.90% in January, marking the first time of two consecutive monthly gains since January-February of 2008, and reversing 21 months of negative annual growth from March 2003 to December 2009."  Well, whaddaya know.
  • TPP, we shall see.  Cato's Sallie James has a great new paper out on the proposed Trans-Pacific Partnership agreement between the United States and Brunei, Chile, New Zealand, Singapore, Australia, Vietnam, and Peru.  Quick summary: "The first negotiating session of this group will meet this week, March 15–19, in Melbourne, Australia. While any positive move from the Obama administration on trade is welcome—especially in light of almost a year's worth of neglect at best and protectionism at worst—there were ominous caveats and concessions in the announcement for those who cared to look. Those murky details call into question the true value of this deal, especially when more valuable, signature-ready agreements are sitting in the hopper."  Sallie provides lots of good data/evidence to back up her claims (natch), so be sure to check out the whole thing.  And as I've already noted, I think she's probably being too kind. 
  • The world and I share a common distaste for Paul Krugman's latest op-ed.  Apparently my humble criticism of Paul Krugman's latest journalistic malfeasance re: China's currency had some great company, e.g., here, here, here, here, here and here.  Heck, there's even a video-fisking!  Good to know.

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