President Obama finally makes one small foreign trade policy move in support of American business and workers, imposing tariffs on Chinese tires in an attempt to prevent the complete collapse of the American tire industry, and the U.S. Chamber of Commerce is all over him. As reported in the above-linked Reuters article,the Chamber takes Obama to task not just for the tire tariffs, but for keeping Mexican trucks off our roads and for not rubber-stamping free trade deals with Colombia, Panama and South Korea.
In every case, the Chamber has sided with foreign countries eager for access to the American market, all in the belief that we are missing out on huge increases in American exports. This, in spite of the fact that our trade results for the past three decades have proven that free trade with overpopulated nations only erodes business for American companies by surrendering our domestic market in greater measure than is ever recovered with exports. It boggles my mind that, when it comes to trade, American economists, business leaders and organizations see no value to our domestic market, eager to give it away, while every other nation on earth salivates at the opportunity to sell their products here.
“A major surge in exports is our best path out of a recession, out of double-digit unemployment and the exploding deficits we’re now experiencing,” Donohue (Chamber President) said.
The emphasis is always on exports, never accounting for imports. The Chamber would have us believe that only exports create sales opportunities for American businesses, and that no business is lost to imports. Such inability to perform the most simple math stretches credulity, and one can’t help but believe there’s something more sinister going on here – that perhaps the U.S. Chamber of Commerce has become a puppet of foreign countries eager to prey on the American market. There’s simply no other explanation.
In fact, the article offers some confirmation that that is exactly what’s going on here, with the Chamber’s position formulated by an international trade consulting firm :
Trade Partnership Worldwide, an economic consulting firm that specializes in estimating the impact of trade policies, prepared the report for the business group.
Throughout the article, the Chamber wrings its hands over the potential for others to cut off imports from America in response to any move by the U.S. to preserve domestic market for our own manufacturers. Never does it consider that we too could retaliate out of proportion and cut off even more of their imports. Do they not understand that, in this game of tit-for-tat, the nation with the huge trade deficit – the U.S. – holds all the cards?
A trade war in manufactured goods is nothing to fear. We can just as easily manufacture any and every product here as anywhere else. And, while a trade war in natural resources certainly would be something for the U.S. to fear, it’s no coincidence that we don’t rely on the same nations who prey upon our markets for manufacturing jobs as a source for our natural resources.
The exclusive use of unfettered free trade is stupid trade policy, as proven by thirty-three years of consecutive trade deficits. The backing of such policy by a powerful and prestigious organization like the U.S. Chamber of Commerce doesn’t confer legitimacy upon it. Rather, it only makes the Chamber look stupid as well. The hard-earned money spent by member companies for the purported benefits of this organization would be far better spent with other organizations who understand the value of balance in trade deals and who demand that others buy as much from us as we buy from them.