June 08, 2003
More on tariffs

Expanding upon the point made by Peter Beinart's article in The New Republic (which I blogged here), comes an op-ed piece by Johann Hari, of Britain's Independent (no link, see update). While he takes a swipe at America's protectionistic practices, he also takes the European Union to task for the subsidies and tariffs which are a big impediment to third world growth. By artifically sustaining the markets for locally grown goods, not only do we offset the expenses of the domestic producers, we also slap tariffs on imported food, making it uncompetitive with the artificially inflated prices of the domestic products, in a double-whammy effect. It is also a double-whammy on consumers in those markets, as we are paying for the subsidies (through our taxes) and for the tariffs (through higher prices in the marketplace).

To be sure, Africa's problems (and those of the rest of the developing world) are not totally the fault of subsidies; there is a lot of corruption and nepotism and mismanagement on their end. However, until we stop the payments to our farmers (in the US, most subsidies end up going to large corporate farmers), we are not going to see much progress in eliminating poverty in the third world.

A snippet from the piece:

Look at New Zealand. It has, since the '80s, shifted from a heavily subsidized agricultural sector, similar to ours, to one that pays for itself. Their farming sector has, as a result, never been stronger, because it is finally standing on its own. American and European farmers would be better off —and have a clearer conscience— if they imitated their New Zealand cousins and became a proper, professional industry, rather than the bloated, subsidy-begging beast we see today.

Although it is not mentioned in this piece, New Zealand has been pushing (with justification) for the US to lower its barriers to imported lamb, but a series of intemperate remarks from PM Helen Clark has left the Bush administration less inclined to listen to the New Zealanders. It would be ironic if overheated anti-war rhetoric served to torpedo a lowering of a trade barrier that would benefit many countries, not just New Zealand.

The Bush administration's actions have generally tracked with what they have said, but on the issue of free trade, there is a significant disconnect. It is one of the seamier sides to the administration, but none of the Democratic candidates is in a position to exploit it, because they either have not defined a trade policy, or favor an explicitly protectionist agenda. Free-market advocates have plenty of reasons to be angry at Bush, but the Democratic candidates are no better, or in several cases are far worse.

UPDATE 9Jun03/11:15—The link is gone; the P-I pulled the plug on it after a day. The Independent (original source of the article) will charge you to read past the first paragraph.

Radley Balko posted this last year, documenting some of Bush's more egregious transgressions regarding free trade; most of the links are still good (perhaps all; I didn't check the last two). I linked to this here, discussing an inane post at Tapped.

posted on June 08, 2003 06:23 PM


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