Many Americans have been engaging in so-called "Japan bashing" because of that country's restrictive trade practices.
Now it's America's turn to be on the receiving end. Only this time the bashing is being administered not by the Japanese but by a bigger and less biased group.We're referring to the 103-nation General Agreement on Tariffs and Trade, better known as GATT, which last week issued a telling critique of some American trade practices.
In its first review of U.S. trade practices in three years, GATT accuses the United States of growing protectionism aimed at halting the flood of cheaper imports into the American market.
The favorite method is to complain about `dumping," in which products produced below cost because they are subsidized are exported to the United States, undercutting American competitors. The number of dumping allegations more than doubled in the first 10 months of 1991. The system for dealing with the practice allows any American company to complain. When the complaint is upheld, penalty duties are added.
Dumping is, of course, unfair and certainly should be penalized. However, the problem may be less one of actual dumping and more a matter of U.S. producers using the law to beat back foreign competitors who can legitimately offer lower prices because their labor and other production costs are lower.
For example, the report notes that between 1988 and 1990, the U.S. Commerce Department ruled in almost every case - 68 out of 71 - that dumping had occurred. Yet two out of three times in those 68 cases the decision seems to have been based more on whether the American industry was being hurt than on a determination that the imports were being sold below cost.
That amounts to a misuse of the anti-dumping law. The law is meant to reject cheaters, not keep legitimate foreign businesses out of the United States market merely because they can offer more attractive prices.
Such practices, plus the use of agricultural and other quotas, make the United States guilty of the same thing Americans complain of regarding Japan and Europe - and weakens U.S. free-trade arguments.
It appears that when it comes to world trade, most industrial nations deal in some forms of protectionism - while loudly pointing an accusing finger at the other guy.
To its credit, the Bush administration has consistently opposed rising protectionist pressures in Congress and among the American public and fully supports the efforts of GATT to promote free trade and to lower trade barriers. And, despite its criticisms, the GATT report does praise the U.S. government for working hard to avoid major trade disputes.
Pulling up the drawbridge and keeping out foreign imports is no answer to U.S. economic woes. That would only result in everybody else doing the same thing - with serious consequences for Americans.