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U.s. Adds Punitive Tariffs On Chinese Tires

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http://www.nytimes.com/2009/09/12/business...mp;ref=business

In a break with the trade policies of his predecessor, President Obama announced on Friday night that he would impose a 35 percent tariff on automobile and light-truck tires imported from China.

The decision is a major victory for the United Steelworkers, the union that represents American tire workers. And Mr. Obama cannot afford to jeopardize his relationship with major unions as he pushes Congress to overhaul the nation’s health care system.

But China is certain to be antagonized by the decision, made less than two weeks before Mr. Obama will come face to face with Chinese leaders at a summit meeting in Pittsburgh for the Group of 20 industrialized and fast-growing emerging nations.

The decision signals the first time that the United States has invoked a special safeguard provision that was part of its agreement to support China’s entry into the World Trade Organization in 2001.

Under that safeguard provision, American companies or workers harmed by imports from China can ask the government for protection simply by demonstrating that American producers have suffered a “market disruption†or a “surge†in imports from China.

Unlike more traditional anti-dumping cases, the government does not need to determine that a country is competing unfairly or selling its products at less than their true cost.

The International Trade Commission had already determined that Chinese tire imports were disrupting the $1.7 billion market and recommended that the president impose the new tariffs. Members of the commission, an independent government agency, voted 4-2 on June 29 to recommend that President Obama impose tariffs on Chinese tires for three years. Mr. Obama had until this coming Thursday to make a decision.

American imports of Chinese tires tripled between 2004 and 2008, and China’s share of the American market grew to 16.7 percent, from 4.7 percent, according to the United States Trade Representative. Four American tire factories closed in 2006 and 2007, and several more are set to close this year.

The Tire Industry Association has opposed the tariffs, arguing that they will not preserve American jobs but will instead cause manufacturers to relocate plants to other countries where they can produce tires cheaply.

President George W. Bush received four similar recommendations from the trade commission, the most recent one involving steel pipe in December 2005, but he rejected all of those recommendations. Under the law, the president is allowed to accept or reject the commission’s recommendations.

More importantly why can't Americans spell tyres correctly?

Does this mean that if you import tyres rather than tires you would get around the import tafiff?

The global trade war and protectionism is slowly warming up.

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The West should apply a tariff on all Chinese goods to the level of their currency manipulation. Then add a bit more to take into account minimal social spending and environmental controls. If that doesn't work let's nuke 'em before they grow too powerful.

Or we could invoke the human rights argument and impose a global minimum wage. Then tax products from non-compliant countries.

That way you can't outcompete other nations by turning your populace into a slave race...

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China can and will simply pull the plug on America when they are ready to do so.

That day is approaching faster than you think.

Edited by Errol

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Well, China announces that it's state agencies no longer have to pay out on Wall Street derivatives.

Not long afterwards, the US announces the first set of tough tariffs on Chinese-manufactured products.

Only one way this is going.......

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The West should apply a tariff on all Chinese goods to the level of their currency manipulation. Then add a bit more to take into account minimal social spending and environmental controls. If that doesn't work let's nuke 'em before they grow too powerful.

The west have tricked the Chinese out of trillions by paying them with paper money and then printing with abandon. Yet in some twisted way you think they somehow owe us something rather than the other way around?

Your other criticism is that they are not as socialist as Obama/Gordon?

You're weird!

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let's not get into all of that inflation / deflation stuff.

Anyway it may still turn out to be a goodyear

Yep, the pressures are building.

They are wheeling out the hot shots and about to burn rubber.

USA/China a bracing row - who will win the grand prix?

Who will end up on skid row?

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If the Chinese get cross, ply them with drink until they wobble. They have other markets round the rim anyway. Non-aligned countries veer towards these actions but soon loose their grip. What's needed is some balancing and them to start tracking global labour prices.

p-o-p

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Yep, the pressures are building.

They are wheeling out the hot shots and about to burn rubber.

USA/China a bracing row - who will win the grand prix?

Who will end up on skid row?

tread carefully!!

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The west have tricked the Chinese out of trillions by paying them with paper money and then printing with abandon.

A very valid point something most people forget, the chinese goverment must feel angry for being taken for a fool.

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A very valid point something most people forget, the chinese goverment must feel angry for being taken for a fool.

If it turns out that they've been made fools of (yet to be seen, IMO, we've yet to see where the resources end up) then it's a consequence of their own mercantilist policies; it couldn't have ended any other way. In which case they'll have made fools of themselves ... more a case for embarrassment rather than anger, I'd have thought.

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Or we could invoke the human rights argument and impose a global minimum wage. Then tax products from non-compliant countries.

That way you can't outcompete other nations by turning your populace into a slave race...

But you can outcompete them by pricing shelter at a level that doesn't force them to demand unrealistic wages for what they're offering.

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A very valid point something most people forget, the chinese goverment must feel angry for being taken for a fool.

Perhaps doing some research on who you are trading with might have been in order then?

When it was profiting China there didn't appear to be too many objections.

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Perhaps doing some research on who you are trading with might have been in order then?

When it was profiting China there didn't appear to be too many objections.

Its human nature when we cheat people it is just good business, when they cheat us they are evil foreigners.

How the domestic chinese population react will be intresting, they could ignore it or go ballastic.

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China is hardly guilt free.

Not letting it's currency properly appreciate against the USD was always going to end in tears sooner or later.

The Yanks have been trying for years to get the Chinese to value their currency appropriately. Now it's China's time to complain .. and the US's time to ignore.

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