the_grip on 17/9/2009 at 12:21
Can anyone explain the real justification as to why Obama hiked the China tire tariff 35%? It looks like it is simply because the United Steelworkers Union petitioned about it, but I'm still scratching my head after almost a week as to why this would be a good idea.
Queue on 17/9/2009 at 12:26
As the Chinese would say, we are trying to rubber them out.
Namdrol on 17/9/2009 at 12:30
That's a tired joke Queue.
june gloom on 17/9/2009 at 12:52
I dunno, I was rolling.
SD on 17/9/2009 at 13:54
Quote Posted by the_grip
Can anyone explain the real justification as to why Obama hiked the China tire tariff 35%? It looks like it is simply because the United Steelworkers Union petitioned about it, but I'm still scratching my head after almost a week as to why this would be a good idea.
Protectionism is very rarely a good idea. In the short-term it might protect the jobs of a few unionised American workers, albeit at the expense of Americans who need to buy tyres and impoverished Chinese workers. In the medium to long-term, trade that is free of import tariffs and duties is massively preferable for everyone. It allows nations that are best at making tyres to do so, and enables everyone else to reap the benefits of being able to buy good, cheap tyres.
the_grip on 17/9/2009 at 13:56
Kinda my thought SD. If China can give us cheaper tires, then let them.
Martin Karne on 17/9/2009 at 14:01
Isn't "cheap" synonymous with bad quality?
Thirith on 17/9/2009 at 14:08
Quote Posted by Martin Karne
Isn't "cheap" synonymous with bad quality?
There's also the other thing: "cheap" very often means, "Yeah, we treat our workers like crap and we pay them crap. Literally. And a bowl of rice." Which is something I have problems with, although most likely I'm ignorant/hypocritical enough to buy stuff from such places half the time.
SD on 17/9/2009 at 14:47
Quote Posted by Martin Karne
Isn't "cheap" synonymous with bad quality?
Not necessarily, although marketing professionals have built empires on the (
http://en.wikipedia.org/wiki/Premium_pricing) perception that higher prices = better goods.
Lower prices are as often as not more down to lower overheads than inferior products. The Chinese cannot just produce a crap product and hope that it sells by virtue of its lower retail price. It has to be of comparable quality to Western-made goods, or people will simply shun it, cheap or no.
In any case, slapping a 35% tax on tyres won't automatically make them 35% better.
Quote Posted by Thirith
There's also the other thing: "cheap" very often means, "Yeah, we treat our workers like crap and we pay them crap. Literally. And a bowl of rice." Which is something I have problems with, although most likely I'm ignorant/hypocritical enough to buy stuff from such places half the time.
Low-paid jobs suck, but they are unquestionably better than no job. I have no moral issue buying cheap goods from China, Taiwan, Macau or wherever, because I know that I am helping someone in the third world to earn a wage. And over time, low-paid jobs have a habit of transitioning into better-paid jobs.
Thirith on 17/9/2009 at 15:45
Quote Posted by SD
Low-paid jobs suck, but they are unquestionably better than no job. I have no moral issue buying cheap goods from China, Taiwan, Macau or wherever, because I know that I am helping someone in the third world to earn a wage. And over time, low-paid jobs have a habit of transitioning into better-paid jobs.
Is that the case? I can only talk from a national perspective here, but in certain industries I would definitely say that if companies get away with hiring people at crap conditions making crap salaries, other companies do the same, so overall crap jobs tend to spread. Treating your employees like dirt spreads. Personally I'm all for governments creating incentives for employers to treat their employees better (I'm pretty much a statist commie if judged by libertarians), whereas going to China for cheap goods will often translate into sending a clear message to national industries: want to compete with the Chinese? Treat your employees as badly, pay them as little, and you may have a chance!
However, I'm happy to be shown evidence that I'm wrong here. I don't have any profound knowledge of economic systems and much of the above is based on how I imagine things to work, based on the little knowledge I have.
