Sorry, Can’t Hear You… There’s an Elephant in the Room

A trade summit with China last week neglected to address the most pressing trade problem facing our two nations head on: how to resolve the conflict surrounding the US’ tariff on Chinese-manufactured car tires, which (of course) is linked to their hitting us with a similar tariff on chickens. There’s nothing to do but escalate and retaliate, it seems… in response to the US’ 35% tariff on imported tires imposed in September, the Chinese will start an anti-dumping investigation on US-made cars.

There’s a succinct piece in the 1 November wsj.com’s Opinion Asia section that lays it out nicely. My sense is that there are too many political rumbles taking place on both sides of the Pacific for either side to back down. It’s a matter of what the country’s respective adiminstrations deem to be worth fighting over. We’re in for a long period of “happy ears” diplomatic and trade meetings between envoys with no skin in the game but only the need to sustain their influence. There’ll be dropping and adding tariffs and investigations, until one side lets the free market reign. Wouldn’t hold my breath.

http://tomhanson.wordpress.com/2009/11/06/sorry-cant-hear-you-theres-an-elephant-in-the-room/