Newton's Third Law... of Protectionist Trade
In his first major official action with regard to trade policy, President Obama followed in the footsteps of Herbert Hoover and George W. Bush by imposing tariffs on tires imported from China. In the words of President Obama's former minister, Jeremiah Wright: "the chickens have come home to roost" — almost literally. China, as countries tend to do when one country's government blocks market access (see: Smoot-Hawley Tariff Act), China has now responded by imposing its own sanctions on American imports: namely, chicken products imported from the US.
The Chinese tariffs range from 40.1% to 105.4%, and include whole chickens as well as other poultry products such as sausage and chicken feet, which, according to the AP story, are apparently a delicacy in China. Hopefully, this represents only a trade skirmish, and not a full-fledged trade "war".
The action by China follows a familiar pattern. It is as if Newton'sThird Law of Motion were adapted and applied to the economics of tradeby Adam Smith and David Ricardo: for every protectionist trade action,there is an equal and opposite protectionist trade action. The real losers in this situation are , well, everyone. American chicken producers now have a smaller market for their product — according to MarketWatch, Tyson Foods alone sold $224 million worth of chicken products in China in 2009. Chinese consumers lose as well — they will have to higher prices and fewer choices when it comes to chicken products; MarketWatch reports that Chinese producers are unable to keep up with demand for chicken feet.
During the 2008 election, then-Senator Obama informed us that his election marked the moment when "our planet began to heal", "the rise of the oceans began to slow", when we "began to provide care for the sick and good jobs to the jobless", and in doing so "restored our image". Unfortunately, even the purveyor of such Herculean feats can't defy the Laws of Motion.
Mr. President, meet Sir Isaac Newton.




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Informative, but not convincing. Something is missing, but what I do not understand. But, frankly: - Bright and benevolent thoughts.
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