Trade Will Never Be Fair and Balanced
For protectionists, trade is never really free. There is always a a reason to impose import barriers.
The U.S. administration attacks free trade in the name of “free and fair trade.” But even this is not enough. It has to be, as Peter Navarro says, “free, fair, and balanced” (I will say a bit more about this in the forthcoming (Fall) issue of Regulation).
Another example was given a few days ago when President Donald Trump responded to an offer of the European Union government to bring all car tariffs down to zero. The general tariff on cars is currently 2.5% in America and 10% in Europe. Trump previously complained about this gap–without mentioning the 25% American tariff on light trucks, which was part of the early 1960s “chicken tariff.” (Pickup trucks make up for more than 15% of U.S. car sales.)
Responding to the zero-tariff proposal, Trump told Bloomberg on August 30 that “It’s not good enough.” “Their consumer habits,” he explained about Europeans, “are to buy their cars, not to buy our cars.” It now seems that they must love American cars as much as (or more than?) European cars in order for trade to be “free, fair, and balanced”–and therefore acceptable. A new frontier for protectionism? Perhaps, but old-time protectionists were also good at finding new excuses to limit trade over political borders.