Tire Protectionism: We All Must Pay

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A story released by PRNewswire-USNewswire said that: "Final step in tire trade case confirmed today (September 2nd, 2009) by U.S. trade representative Leo W. Gerard, International President of the United Steel Workers (USW) expressed confidence President Obama will grant the U.S. tire industry meaningful relief from Chinese tire imports that have injured domestic production workers".

What does this mean? This means that if Obama grants (steals and gives away) this relief (taxpayer money) due to pressure from the mafia-style union (USW), then all of the rest of us will suffer from higher prices on these goods. This is always the case with bailouts, subsidies, and protectionist measures. According to the union thug Gerard, "This is the time and this is the case for the President to open the trade enforcement toolbox". Of course, most sane and intelligent people fully understand that if this "relief" is forthcoming, it is just a strong-arm tactic by the federal government to once again take from the productive in society, and by force, and redistribute to the very non-productive union. Or in other words, more legalized theft to buy votes!

Gerard went on to say that "We are confident the President shares our values (emphasis mine) of promoting a rising standard of living for the American worker. This trade case gives him the chance to put into practice his pledge to level the playing field and give all Americans a chance to share in the benefits of balanced trade". This is hogwash and an absolute lie! What he left out, of course, is that all American workers and everyone else not in the tire industry would be harmed by this very corrupt protectionist measure. Only the USW and those retired USW members that are receiving subsidized pensions and medical insurance would benefit from this trade restriction. The hundreds of millions of the rest of us would of course suffer. Will President Obama refuse to grant this largesse given that many might lose their precious subsidized health insurance just at a time when he is demanding that all have coverage? Could that be a bad PR move on his part? You bet it could, and the USW will take advantage of that fact.

"According to records in the USW case," a case that began last April, "a massive 215 percent surge in passenger and light truck tire imports by volume, and even greater 295 percent surge in value occurred during 2004—2008. The result has been a loss of more than 8,100 domestic tire jobs by the end of 2009 from closed plants." For some reason unknown to me, the fact that this government has plunged this country into a depression was not mentioned as a reason for any of these job losses. Since consumers are broke, and are looking for bargains, and total unemployment is skyrocketing, shouldn’t that have been mentioned?

Just this week, I went shopping for tires for my large diesel pick-up truck. I got prices from three different dealers, two in my home town and one outside of town. The price difference for the exact same four tires ranged from a low of $795.00 to a high of $1,120.00. This is almost a 30 percent difference in price. How can the price spread range that much for the identical tires? Maybe the dealer with the lowest price got his tires from China. These are Cooper Tire & Rubber Co. (an American company) tires, and after a little research, I found out that Cooper not only has plants in China, but is currently expanding its operations there. I have no way of knowing if my tires came from China, or if I am just benefitting due to Cooper’s presence there, but who cares? As long as I get a better deal, I am one happy consumer; and all those who benefit from my saving money; the butcher, the baker and the candlestick maker, are better off as well.

As an aside, Cooper Tire & Rubber Company, the second largest tire manufacturer in the U.S., is a USW union shop here in America. In their defense, Cooper has opposed levying tariffs on Chinese tires; this in direct opposition to its union workers. Along with Cooper, Toyo Tire & Rubber Company has also spoken out against Chinese tariffs. Toyo builds tires in Atlanta, Georgia, and if they could not import cheaper tires to help support their higher quality lines, they would be hurt. Both of these companies employ a lot of American workers, and if they are harmed, so will their workers be harmed. Goodyear, the largest U.S. tire manufacturer, who also has a plant in China, has not taken a position on this issue due to the fact that only 2 percent of tires sold in America by Goodyear come from China. What a contradiction! The USW and its members are attempting to harm the very companies that employ them. All these companies have Chinese plants because they can’t compete in the U.S. because of the high cost to do business due to union thugs and the government minions who support and protect them. By lobbying for tariffs, the USW is attempting to fatten its wallet at the expense of its own workers and the rest of America, but the members are too ignorant of reality to understand this ruse. The USW members by supporting these government tariffs are in essence attempting to harm the very company they work for, thereby putting their own jobs at risk. This is asinine and it is a stupid decision on their part.

The bottom line is this: All protectionist practices whether implemented by trade restrictions, tariffs, subsidies, or any other method, are designed to benefit the few at the expense of the many. The few in this case is the USW, and the many is all the rest of us. Sadly, slimy politicians gain favor with voters by implementing these policies; claiming that they care about the American worker and saving jobs, when in fact, nothing could be further from the truth. They are simply preying upon the economic ignorance of the public-schooled masses in this country, hoping to gain more votes during the next election in order to stay in power.

All I can say is thank God for Chinese tires! With my savings of $325.00 I can buy more food stores, more ammo, more heating fuel, or anything else I need to survive this depression. By doing this, I am supporting other American businesses that employ many more people than do the American tire companies, and therefore am supporting American workers. I’m willing to sacrifice the USW and its workers in order to help all of America, and I hope many will join in to do the same.

Background, testimony and statements on the USW trade case can be found here.

Gary D. Barnett [send him mail] is president of Barnett Financial Services, Inc., in Lewistown, Montana.

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