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Tire Quota Would Run Over Free Trade
First, there was the “Buy American” provision in the stimulus bill prompting foreign leaders to threaten to enact their own protectionist legislation. Then, there was the closure of the border to Mexican trucks, sparking retaliation by Mexico to increase tariffs on 90 U.S. imports. Now protectionists in Washington are pushing the Obama Administration to cap imports of Chinese manufactured tires by nearly half.
The United Steelworkers, who strongly backed Obama during the election, filed a petition with the International Trade Court to impose import quotas on rubber tires from China. The reason? American tire manufacturers are losing to cheaper imports coming from China, $3 to $74 cheaper. So rather than remaining competitive with their Chinese counterparts, the anti-trade steelworkers want to force American drivers to pay more for the goods that could be purchased more cheaply abroad.
The US has been down this protectionist road before. The Smoot-Hawley Tariff Act of 1930 was also introduced as a means to protect American workers and businesses and reduce imports during a global recession. What followed? The Great Depression.
