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"Proving himself less principled than Bill Clinton regarding the free trade principles that are indispensable to world prosperity and comity ... Bush has cooked up an unpalatable confection of tariffs and import quotas that mock his free-trade rhetoric." -- George F. Will, columnist.
The Bush tax increase will hurt the American economy and threaten jobs across the Niagara Frontier and the nation. Especially vulnerable are jobs at Delphi's Harrison Radiator in Lockport, and at General Motors, Ford and other auto-related manufacturing plants in Western New York.
The Bush tax increase will drive up the prices Americans pay for all kinds of goods. Everything from big ticket items like new homes and cars to household products like washing machines and lawn mowers.
The Bush tax increase creates more federal bureaucracy. Government will intrude in business manufacturing decisions in futile attempts to have an "industrial policy."
The Bush tax increase is infuriating the nearest neighbors in our hemisphere and the best and most reliable trading partners we have.
The Bush tax increase is outraging our friends in Europe at the very time we need their help and support in dealing with terrorism and flash points around the world.
The Bush tax increase is nothing but cynical, unprincipled politics aimed at "buying" a few votes in November's congressional elections and is a prelude to the shameless pandering that's sure to follow in the 2004 presidential election.
The Bush tax increase defies sound economic principles and will hurt the many to placate the few government-addicted corporations and unions that have the president's ear.
What tax increase, you say? Bush cut our taxes and vowed to oppose any effort to change his tax package, which most benefited Texas oil millionaires and did the least for the middle class.
Well, folks, Dubya's got ya buffaloed if you didn't spot his monumental tax increase, which could spiral into more hardships for countless Americans.
The Bush tax increase is the tariff. Quite simply, removed from any Texas obfuscation, a tariff is a TAX on imported goods. That's what the president's done with steel, a 30 percent tariff -- uh, tax.
The move appalls free trade champions, including Paul O'Neill, the president's own Secretary of the Treasury. He candidly told the Council on Foreign Relations he believed Bush was unwise to impose tariffs on foreign steel because they will cost more jobs than they create.
One estimate is that for every job the tariff will temporarily save in the steel-making industry, the tax will destroy 10 jobs in steel-consuming manufacturing industries. And already more than 1,000 companies have applied for exemptions from the steel tariff based on their claims, mostly legitimate, that they can't get the specialty steel they use from domestic producers.
The Commerce Department has to process these mounting requests, and that means some government bureaucrat whose primary concern is making the 4:35 p.m. Metro to Bowie, Md. will decide if a machine shop in North Tonawanda that needs the foreign steel will remain open.
Please note, this experiment in national industrial policy comes from a Republican administration that talks about free trade, open markets, and keeping government out of our lives.
The American steel industry has been in trouble for decades, and even with the protectionist tariff, big steel in the United States remains in big trouble. The industry has improved productivity somewhat, but after spending most of the 20th century ripping off billions in profits while reinvesting pennies, the gains may be too little, too late.
The big steel producers also face stiff competition from mini-mills. These operations, many of them foreign, use scrap metal and electric arc furnaces to produce steel at a huge cost advantage.
These plants are usually newer and don't have the fixed costs and large costs for retired workers the traditional producers have.
A decade ago, 20 percent of U.S.-produced steel came from mini-mills. This year it might top 50 percent and the tariff will do nothing to stop that trend.
The politics of courting steel tax are transparent. Key swing states like Ohio, West Virginia and Pennsylvania have the greatest concentration of steel mills and workers.
Bush wants to keep these voters in line in November and therefore he hopes to keep the House of Representatives in Republican hands. Down the road, any of those states could represent the margin of victory in another tight presidential race.
So the choice is simple for George W. Bush. Do I stand for principle and the good of the national and world economy, or do I sell out to save my and other Republican hides?
Bush thought for about 10 seconds and chose the politically expedient course, and he's heading in the same direction for other industries clamoring for trade protection.
Lumber from Canada is getting slapped with a 30 percent tariff, and that act alone could add $1,500 to the cost of a new home. The United States imported $5.7 billion worth of Canadian lumber in 2001, nearly a third of the entire U.S. supply.
The president is trying to protect his buddies in the lumber industry and nailing the bill on the mortgages Americans will pay.
The Canadian lumber industry has production efficiencies that keep costs down, in spite of the tougher environmental restrictions our neighbors to the north impose.
The president's tariff on Canadian lumber is pure protectionism and makes a mockery of the principles of the North American Free Trade Agreement.
Canadian Prime Minister Jean Chretien sees the rank hypocrisy of this, in light of the United States' reputation as a supporter of free trade, especially in our own backyard.
"They want to have our oil, they want to have our gas, and they don't want to have our wood ... They cannot choose and pick," said the Liberal Party Prime Minister of the trade policies of the Republican U.S. President who calls himself a conservative.
The Canadians are ready to retaliate and we should not be surprised if this whole mess damages efforts to bring about a unified Western hemisphere trading community, like our European competitors already have.
The Europeans are also furious over the U.S. steel tariffs and they're putting up their own barriers to keep Chinese and South Korean steel, now blocked from the U.S. market, from being dumped there.
But the Europeans are doing more than getting mad. They're getting even. The European Union is plotting its own tariffs on U.S. products.
Let's start with oranges, they say. And where do they come from? Why, Florida, where the president won his razor-thin election victory and his brother just happens to be running for re-election for governor this year.
You can add Harley-Davidson motor bikes from Wisconsin, and steel from West Virginia and Pennsylvania to the Europeans' tariff target list.
Only short-sighted politicians win anything in a trade war and those victories are always fleeting. Bush's foolish move is causing a worldwide disruption, and it's so unnecessary when you consider his still high standing in the polls.
When the president talks about free trade and open markets, don't bother reading his lips, watch his actions, and worry.
| Niagara Falls Reporter | www.niagarafallsreporter.com | April 2 2002 |