President Bush has a nice little Christmas present for
every family struggling to make ends meet: he announced
the other day that he will make clothing more expensive
in the coming year by imposing limits on cheap imports
from China. This little favor to American textile and
apparel interests is a slap in the face to everyone of
modest (and not-so-modest) means. It is also a blow to
clothing retailers who tried futilely to block the
presidents move.
The next time a politician expresses sympathy for
working families or the working
poor, remember this. Where are all the bleeding
hearts now? Too deeply embedded in union pockets to
condemn this outrage.
On January 1, the decades-old world system of textile and
apparel import quotas will come to an end. This is a good
thing. The global division of labor and free trade make
us richer, even if they prompt short-run adjustments. But
with the impending demise of the exploitative quotas,
people beholden to U.S. textile and clothing
manufacturing interests have been warning that the
American market will soon be flooded by inexpensive
Chinese products
To which we should say: Bring them on! Who would gain by
this? Obviously, low-income people struggling to clothe
their children and themselves would benefit. Other
beneficiaries would include retailers, who prosper by
having a greater variety of products across a range of
prices. The short-run losers would be those who make
textiles and apparel domestically. But keep in mind that
high technology has been shrinking the U.S. textile
workforce for many years. The developing world has a
comparative advantage in labor-intensive manufacturing.
In fact, it is other developing countries such as
Bangladesh that will feel the effect of expanded Chinese
exports.
Competitive pressure makes people better producers. If
the American textile and apparel industry is to have a
future, it must find ways to meet the competition.
Seeking shelter and conspiring against consumers
wont help.
Besides, how dare the industry ask government to forcibly
interfere with our right to trade with whomever we
please!
Unfortunately, China says it will cooperate with the
protectionist Bush administration and accept the
so-called safeguards, that is, limits on their exports,
until 2008. It has gone even further, announcing that it
will enact a tax on textile and clothing exports. The tax
would violate World Trade Organization rules, but since
no member government has an interest in complaining,
theres nothing to stop it. And they call it a
free-trade agreement.
The rationale for this new tax has been camouflaged by
diplomatic mumbo-jumbo. Chong Quan, a Chinese commerce
ministry spokesman, said, This is part of a string
of measures China will take to ensure a smooth transition
for textile integration following the end of the quota
system. That was followed by this from Mary Brown
Brewer of the U.S. Commerce Department: We will
continue to work with China and other nations to
facilitate an orderly transition from the textile quota
system.
Translation: The U.S. government will put the screws to
the Chinese if they dont cooperate in this
shameless scheme to rob low-income Americans. The game
was given away by Augustine D. Tantillo, executive
director of the American Manufacturing Trade Action
Coalition, who scoffs at the Chinese tax offer and
demands rigid limits: It is like, instead of being
70 percent below the U.S. price, theyre now going
to be 58 percent below the U.S. price.
Tantillo, of course, wants Chinese products to be priced
above his members price, and hes for any
measure that would bring that about. No doubt he also
supports all the welfare-state programs ostensibly
intended to help low-income people.
Free trade is the poors best friend. The next time
someone demands that something be done for the poor, say
to him, No, something should be
undone!
Sheldon Richman is senior fellow at The Future of Freedom Foundation, author of Tethered Citizens: Time to Repeal the Welfare State, and editor of The Freeman magazine. Send him email.
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