December 05, 2003

Let me count the ways...

The steel tariffs are thankfully history, but they were an atrocious policy. How bad were they? Let me count the ways:

  1. They lost more jobs than they saved — most economists agree that more jobs in steel-consuming industries were lost than saved in steel-producing ones.
  2. Consumers paid through the nose — something like $1.2 billion in higher prices over the 18 months of the tariffs
  3. US credibility as a free-trader was damaged — added to the debacle in Cancun and the anemic progress in Miami, we resemble the caricatures of the anti-globalization movement
  4. It was bad politics — Bush got no credit from steel workers, who were quick to back Gephardt for president, and little from steel companies. The lame attempts to claim victory and say that an independent assessment, not EU pressure, led to the repeal of the tariffs, made the administration look terrible; and Democrats, champions of multilateralism, blasted Bush for caving to the Europeans
  5. We caved to the EU — we ended up responding to economic threats, retaliations targeted at key political battlegrounds, and gave the appearance that we can be pushed around when our pocketbooks are on the line (even if we can't when our lives are)

All in all, another bad showing for the Bush team.

Posted by richard at December 5, 2003 11:15 PM

What was the Bush team thinking when they enacted the tariffs - has there been a lesson learned? Or is it a blunder pure and simple?

Posted by: Michael Weiksner at December 6, 2003 07:55 AM