Thursday, November 19, 2009

Obama's regressive and economy-harming protectionism; at least the unions like it

From the editorialists of the WSJ (hat tip: Linda)...

Remember that 35% tariff President Obama imposed on tires imported from China this month?...Since the tariff announcement on September 11, U.S. tire wholesalers have been warning that their sales prices to retailers will increase by about 15% on average. In some cases, the hikes are as high as 28%, according to industry sources....

Low-income Americans will bear the brunt of the pain because Chinese tiremakers sell the cheapest tires...

Mr. Obama's political sop to the United Steelworkers union that requested this tire protectionism will be expensive for the economy overall, too. Rutgers economist Thomas J. Prusa, who had estimated the potential impacts of tariffs at the request of tire importers, calculates that the 35% tariff will cost the economy about 20,000 jobs in the tire distribution and retail sector while "saving" only 1,000 jobs at domestic manufacturing plants. U.S. consumers will pay $330,000 in higher tire prices for each of those 1,000 jobs....

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