Wed, 21 Jul 1999

American hypocrisy

Just in case anyone misses the message, the U.S. boasts endlessly about its deep devotion to free trade and the need for others to open markets to global commerce. Again and again, America claims no one matches its determination to cut barriers of those who seek to protect themselves from competition.

All of which is true enough except, of course, when it's not. This week has not been a good one for White House consistency on free trade. Responding once again to domestic complaints, the Clinton administration took several measures to curb certain imports which special interests found uncomfortable.

The moves were wrapped in the usual cant, but in fact were acts of blatant protectionism. Topping the list are new restrictions on imports of Australian and New Zealand lamb. Quotas will be enforced and duties of up to 40 percent will be levied, combined with a new US$100 million subsidy program for domestic producers.

This combines the two kinds of actions that Washington opposes so heatedly when others take them. No wonder the Australian trade minister felt obliged to say they show the world that the U.S. is not fair dinkum about fair trade.

Washington also strong-armed Brazil into reducing certain steel shipments by nearly one-third, or face import duties of up to 53 percent. Last week it imposed duties of 67 percent on some Japanese steel, and next week expects to do the same to Russia. Meantime, U.S. producers want penalties on other steel products with unfairly low prices. They almost surely will get them; in the early 1990s, American companies won 208 of 212 similar disputes.

The official goal is to protect U.S. companies from having others dump surplus goods at below-cost prices. In reality, these actions too often prop up inefficient producers while taxing consumers in the form of higher prices.

-- The South China Morning Post, Hong Kong