A steep tariff on imported tires from China that was opposed by local tire retailing giant Les Schwab has survived a challenge at the World Trado Organization. The WTO announced on Monday that it would uphold the tax on imported Chinese tires that President Obama implemented over Beijing’s objections in 2009. The tariff increased tire taxes by 35 percent in the first year and has raised them again in each subsequent year.
According to labor groups, the higher tariffs have stemmed the tide of cheap Chinese tires into the United States allowing domestic manufacturers to regain a larger share fo the market and add jobs. In fact, US imports of Chinese Tires fell by almost 24 percent last year.
However, that means higher costs for tire retailers like Les Schwab which imports a significant amount of its inventory from China. The company has declined in the past to say how much of its stock originates in China. However, it said that the higher tariffs would result in higher costs for its customers. The tire manufacturer won the support of Oregon’s congressional delegation, including Senators Merkley and Wyden who lobbied against the tire tax.
This article appears in Sep 1-7, 2011.
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The increased tire tariff has been shown to have cost American jobs all because Obama again chose to payback the Unions who funded his campaign. Obama continues to play favorites with Unions as he needs their votes and cash for the 2012 election which he is projected to lose at this time.
That is a joke, right? Or are you seriously saying increasing American production of tires costs American jobs? I say slap a tariff on everything made in China, until we have a domestic manufacturing base again.
Thomas – which job studies are you referring to – can you please be specific and attempt to avoid blanket generalizations stuffed with a healthy dose of ambiguity. Wouldn’t it be somewhat safe to say that the decrease in imports combined with the continued demand for tires in the USA actually stimulate the creation of new domestic jobs due to the necessary increase in production of new “Made in America” tires to meet consumer consumption? Or maybe you just love the quality and safety of your family riding on Chinese made tires and it’s not actually about jobs or economics.
Copper Tires was the last American company to produce made in America Tires, 3 years ago they switched to china aswell. Sad but Mr. Clark is correct.
According to US Bureau of Labor statistics tire manufacturing jobs in America have declined this last year. US imports of low end Chinese made tires declined while tire companies shifted low end tire production ie: jobs to other countries. So the end affect of the Obama union payoff has been Chinese tires being replaced by tires now being made in other countries at a higher cost to consumers and the loss of American jobs.
You put the words out there – but they still make no sense. If we are importing tire from Brazil (say) instead of China – how does that cost American jobs? If we banned import (say) of all tires, which would be a maximum tariff, I guarantee production would return to this country.
We ned to assign high tarrifs on anything made in China and brought into the USA – they are ruining our economy and they run sweat shops where children are forced to work for a mere subsistance…get your head out of the sand americans and get a clue – China is destroying us now because all of our fortune 1000 us based firms are exporting all of their jobs to China!
rmm200 and Blow-hard are obviously Hoover Republicans with their Smoot-Hawley calls for tariffs on imports without any appreciation for the historical implications. This was tried once before with the result being the Great Depression.
Smoot-Hawley, passed in 1929, was one of the prime causes of the Great Depression. It raised tariffs to almost 20% by 1932. U.S. imports from Europe decreased from a 1929 high of $1,334 million to just $390 million during 1932, while U.S. exports to Europe decreased from $2,341 million in 1929 to $784 million in 1932. Overall, world trade decreased by some 66% between 1929 and 1934. US unemployment was at 7.8% in 1930 when the Smoot-Hawley tariff was passed, but it jumped to 16.3% in 1931, 24.9% in 1932, and 25.1% in 1933.
Blow-hard says: “China is destroying us now because all of our fortune 1000 us based firms are exporting all of their jobs to China!”
Darn right. Until this country can provide a competitive and consistent structure of policy, regulation, and tax, it will continue. That is free market/capitalism which I realize that is a novel concept among many of you.
“The Smoot-Hawley Tariff was more a consequence of the Great Depression than an initial cause.” Not to mention that it was passed after the great crash of 1929. If you really think we have benefited from GATT and NAFTA – not much I can say. A lot of us do not agree with you.
Sorry rmm200, Smoot-Hawley was in the works long before the crash and was not developed as a consequence of the depression as you state. Please Google it for a primer.
Smoot-Hawley was passed shortly after the crash, but its affect on world trade is undeniable and was a very significant factor that turned a stock market issue into a global depression that lasted for the better part of a decade.
I’m sure you plus others don’t agree with me and you’re entitled to your own opinion…you’re just not entitled to your own facts.
Try Googling the quote I presented. Wikipedia also has a long discussion on Smoot-Hawley. Don’t presume that others have not done the research.
Wikipedia?? OK rmm, I’ll also use Wikipedia as the end all of everything true. From Wikipedia:
“Although the tariff act was passed after the stock-market crash of 1929, some economic historians consider the political discussion leading up to the passing of the act a factor in causing the crash, the recession that began in late 1929, or both, and its eventual passage a factor in deepening the Great Depression.”