Reagan slapped a tariff on Japanese motorcycles. They were dumping their motorcycles in the US at below cost to drive Harley out of business. After that, they intended to jack up the price of their motorcycles.
Whenever the US oil industry gets going, the Saudis pump and drive the price down until all the US manufacturers go out of business. Then they shut down the spigot and jack the price again. If you just say, "I support free trade," other nations will eat your lunch. The simplest way, and one which Japan used a lot, was to have the government funnel money to companies so they could sell at a loss until competitors went out of business.
OTOH, just throwing up tariffs allows US manufacturers to get frikkin lazy and form a cartel (Ford, GM, Chrysler before the Japanese and Germans got in.)
People negotiating trade deals have to be sharp, and they have to be people who won't sell their country down the river for a pitifully small bribe. You can't say, "I'm for free trade" and walk off, expecting everyone else to play fair.
Yes, and W. put a tariff on steel for the same “dumping” reason.
No one’s suggesting putting a tariff on Saudi oil though, are they? People don’t support tax increases when they see it affect them directly in what they’re buying, as opposed to trickling down from a manufacturer’s supply chain.
I say let the market deal with it. We don’t need the government to run a command economy from their ivory tower constantly trying to put their thumb on the scale to make things come out the way a certain interest group thinks it should. Sometimes competitors will play rough and get the upper hand on us. That doesn’t mean we should whine and cry to daddy and ask for him to bail us out. If that bail-out is right, then what was wrong with the Bush bank bail-outs? We just have to look for another opportunity if our competitor out-competes us. If they really kill our industry and then jack up prices, then we’ll just start our industry up again. When gas prices got too high here, we started fracking. And that’s what led to the Saudi dumping. In the end, the consumer’s going to make out pretty well. Either they’re getting cheap, dumped products, or the domestic industry is ratcheting itself up to counteract foreign gouging. Getting deals on both ends like that makes up for the higher bump up in price in the middle.
The same applies to domestic stores. If stores want to do “loss leaders,” they’re selling below cost. But the last thing anyone needs is for the government jackboots to raid their store and start dictating what prices they should charge. It’s the same logic against the auto industry bail-out...we don’t need to be afraid of the creative destruction. Some businesses will die out and others will be reborn from the ashes. We don’t need big daddy constantly trying to save us from every little amount of pain that happens in the marketplace.