Obama to impose tariffs on Chinese tires

WASHINGTON – President Barack Obama on Friday slapped punitive tariffs on all car and light truck tires entering the United States from China in a decision that could anger the strategically important Asian powerhouse but placate union supporters important to his health care push at home.

Obama had until Sept. 17 — next week — to accept, reject or modify a U.S. International Trade Commission ruling that a rising tide of Chinese tires into the U.S. hurts American producers. A powerful union, United Steelworkers, blames the increase for the loss of thousands of American jobs.

The federal trade panel recommended a 55 percent tariff in the first year, 45 percent in the second year and 35 percent in the third year. Obama settled on slightly lower penalties — an extra 35 percent in the first year, 30 percent in the second, and 25 percent in the third, White House press secretary Robert Gibbs said

"The president decided to remedy the clear disruption to the U.S. tire industry based on the facts and the law in this case," Gibbs said.

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Now i know that there will more than likely be some ramifications over this decision, and China as well as other countries will probably be rather upset, but i have to say that i think it's about time. The time for placing higher tariffs on imported goods is long overdue, and with the shape that our ecomomy is in and the unemployment rate in this country something needs to be done to help Americans.

American companies simply can't compete with the lower prices of imported goods from countries like China, and most American consumers can't afford to purchase anything else which is why we have been on this downward spiral concerning jobs. We used to be a nation of producers and we are now a nation of consumers, unfortunately consumers cannot purchase without money. We need to go back to being producers again so we can survive, hopefully he will impose a couple more tariffs on a couple more imported goods and help us out.

reply to post by chise61


A broke nation reverting to charging tariffs on tires made from China imported into the U.S. will be the start of what will be known as the New World Trade Wars.

My opinion is you can expect everything you buy to go up in price because of the New World Trade War higher tariffs that I feel will be imposed on foreign goods by the U.S. in the not so far off future. A broke nation will go to great lengths to capture money thru taxation no matter where it comes from you or another country.

I also believe you can expect extreme protectionism that I believe will backfire on this administration when it comes to foreign trade. This will be done in the name of creating new jobs at the expense of the U.S. consumer paying more money for goods made in the U.S.

What is wrong with manufacturing products in the U.S.? Absolutely nothing if you create more tax incentives for businesses and less regulation we as a nation can compete worldwide more effectively. This will help consumer's pocketbooks as to not have to pay as much for manufactured goods made in this country.

There is never a perfect world when it comes to international trade. I say create a no dumping zone called the U.S. Borders trade Act. Whether by land or by sea any manufactured goods from a foreign nation passing into and across U.S. borders can not have an unfair subsidized price advantage by another country over U.S. goods manufactured here. Especially when it comes to dumping foreign made cars on U.S. soil. Protectionism? I call it fair trade and if a foreign country does not comply they can not sell that specific product in the U.S.

If this administration was really interested in helping the little guy they would pour stimulus money in the direction of the people and not the banks that own our government. The more government regulates bussiness and the people the more you will pay for everything. ^Y^

Just one question, is this related to imports of Chinese brands or Chinese made tires of non-Chinese brands?

I ask because I do not remember seeing one Chinese tire brand in all my life.

reply to post by ArMaP


With China ramping head long toward the largest per capita owners of automobiles it's just a matter of time before they dwarf our tire industry with a artificially low currency and mass production. Instead of us making money selling to that market we would get crushed by their cheap labor.


[edit on 12-9-2009 by SLAYER69]

I read that he was advised to do it. I didn't read it has actually been done yet. It is perfectly legal under the trade laws.

While the Chinese are not happy about it, they also seem to understand.

reply to post by SLAYER69

Yes, but that doesn't answer my question.

reply to post by ArMaP


Some think it would only be a matter of months before these brands would dominate.

Brands Here



[edit on 12-9-2009 by SLAYER69]

There should be high tariffs on everything imported and the cost of doing business in America should be lessened accordingly if we want American jobs and Americans buying American produced goods.

See how many businesses close up shop and run off to Mexico if the cost of importing their product were to jump 10,000%.

Can't let that happen, though. Everyone has grown rich, fat and lazy consuming and selling and legislating off of disposable garbage at dirt cheap prices.

reply to post by thisguyrighthere


The problem being that the US consumer is the one who will pay the price for this, via increasing cost and less competition. All fine for those with high paying union jobs who want to charge top dollar for, and can afford US products that last half as long as most imported ones. Not so good for the rest of us who are not 30$+ an hour union employees.

reply to post by defcon5


If the cost to produce in America fell relative to the cost imposed on importation the prices would fall. Plus, dont buy crap you dont need. If it is something you need and it's still pricey make sure you get the version that is going to last for 10 lifetimes. Not the less-expensive version you'll have to replace in 6 months.

Things are already too cheap and too abundant. The amount of waste is astronomical across the globe because of the half-assed circus that is 'world trade.'

For the record I have left every job that attempted to 'unionize' and will despise unions till the day I die. I also make less than half of what's reported in your example.

reply to post by defcon5


It's all about their artificially low currency

www.npr.org...
If not by the market, then how is the value of China's currency set?

China's central bank simply declares an exchange rate and forces, by law, all market players to observe that rate. The yuan is allowed to fluctuate a tiny bit, but not much -- and certainly not enough to accommodate the constantly changing pressures of the global marketplace. The Chinese have pegged the currency so that one U.S. dollar buys a little bit more than 8 yuan. Put the other way, one yuan is worth a bit more than 12 cents.

Most economists believe that if China's currency were allowed to trade freely, it would be worth more. No one can know for sure how much more, but leading economists put it in a range of 10 to 40 percent higher value than it is now. So, the yuan could go from being worth 12 cents to more than 17 cents.

Why should I care what the Chinese currency is worth?

By keeping the yuan artificially low in value, China is effectively giving U.S. consumers a discount on all Chinese exports. Why? Let's say a Chinese factory can make a profit selling DVD players for 800 yuan. That means they can then sell it to someone in the United States for $100. If the yuan were allowed to appreciate in value, that 800 yuan DVD player might suddenly cost, say, $115. If an American factory makes a similar player for $110, then that change in the value of the yuan can make the difference between business success and failure for the U.S. manufacturer.

So, by keeping its currency undervalued, China is discounting its own exports. That's good for U.S. consumers, who get to buy cheaper clothes and electronics and other items. But it's horrible for many U.S. manufacturers who find they can't compete with low Chinese prices. Some U.S. manufacturers, though, have adapted by buying many component parts at a lower cost from China. The ability of a manufacturer to adapt depends on the company and the product -- and even on the level of globalization in that industry.

reply to post by SLAYER69

Is this move from Obama to avoid a possible future flood of Chinese tires or is it to stop an already going flood of Chinese tires?

Originally posted by thisguyrighthere
If the cost to produce in America fell relative to the cost imposed on importation the prices would fall.

I’ll agree with you as soon as they salary cap the union jobs, until then competition is the only thing keeping costs in line. You remove that competition, you’ll be paying 10X what you are now for American goods that are intentionally engineered to fall apart after X amount of time to force you to buy more goods. The union wages will increase yearly driving the cost/price up. I worked in engineering in an auto company, so I know of what I speak. Now I work in the medical field, and guess what? Most medical jobs are salary capped, and most college educated medical professionals make less then high school educated assembly line workers.

…OR maybe we should uncap fields like medicine, and you can watch the price of medical care go through the roof…. Of course no one would stand still for that, but we sure will when we hear the same thing from the auto union lobby, won’t we?

Unions are nothing short of organized crime, and history shows us the link between the two. They drive up salaries, so they can drive up their take of those salaries. That’s all there is to it. This unnecessarily drives up production cost, and sales cost while at the same time causing manufacturers to cut production standards, thus quality, so their products can be afforded by the rest of the common folk. Then they guilt trip the American public into buying their high cost junk, with their, “Buy American” crap’olla….

Originally posted by thisguyrighthere
If it is something you need and it's still pricey make sure you get the version that is going to last for 10 lifetimes. Not the less-expensive version you'll have to replace in 6 months.

Your right on this point though…
I bought a foreign car…
Over 300K miles, more then double a US car, and its still ticking like a clock…


[edit on 9/12/2009 by defcon5]

reply to post by defcon5


I'm not a fan of unions or salary caps. The market will dictate what an employee is worth and it will also dictate how much a consumer is willing/able to spend for a good or service.

Those car companies went bankrupt in part because of union extortion/political power. In the real world an uncapped salary could only go so high before they priced themselves right out of a job. All it takes is one person to offer the same work/service for less and those highly paid employees are either making themselves worth more or living with less of a wage and dealing with it.

'World trade' and union extortion and political influence pervert the process.

I'm assuming that if America wanted to get serious about America it would do away with these influences as it imposed high tariffs on imports.

But who am I trying to kid? America is full of organized criminals looking out for themselves and allowing the market to within America to run free from these artificial variables would be the last thing they would want.

Originally posted by thisguyrighthere
Those car companies went bankrupt in part because of union extortion/political power. In the real world an uncapped salary could only go so high before they priced themselves right out of a job.

Well…
That was exactly what happened, except the part were they went out of business like they should have. Instead they forced each American to buy a car that we did not receive but will pay for through our taxes. The unions and the manufactures cried to the government, and got our tax dollars so they could continue after they should have failed.

Originally posted by thisguyrighthere
All it takes is one person to offer the same work/service for less and those highly paid employees are either making themselves worth more or living with less of a wage and dealing with it.

That is why unions have “Closed Houses”, because they don’t want someone else coming in who is willing to do some actual WORK for only say… $20/Hour.

We have over a 100,000 homes effected with chinese drywall. Its estamated that it will cost 2/3rds of the value off the homes to repair them. And the chinese have basicly said its your problem. And people want there tires. I say screw China. How many pets did they kill with there poisoned pet food.

Repeating and rephrasing my question, maybe this time someone answers me.

Are these new tariffs to be imposed on Chinese brands tires only or on other brands from other countries but China-made tires also?

Originally posted by ArMaP


Sorry Buddy.

Real life crept in. That's a good question. Shipping them in from other countries could possibly bypass such a tariff. Dont know

reply to post by SLAYER69


I also ask this because they could apply those tariffs (I didn't knew that this word was used in English ) to other brands but made in China, and if that is the case then other countries would be involved.

reply to post by ArMaP


All the article states is that the tariffs are on Chinese tires.

Is this move from Obama to avoid a possible future flood of Chinese tires or is it to stop an already going flood of Chinese tires?

According to the article it's to stop an ongoing flood of Chinese tires.

The steelworkers union brought the original case in April, accusing China of making a recent push to unload more tires ahead of Obama's expected action. The union says more than 5,000 tire workers have lost jobs since 2004, as Chinese tire overwhelmed the U.S. market.

The U.S. trade representative's office said four tire plants closed in 2006 and 2007 and three more are closing this year. During that time, just one new plant opened. U.S. imports of Chinese tires more than tripled from 2004 to 2008 and China's market share in the U.S. went from 4.7 percent of tires purchased in 2004 to 16.7 percent in 2008, the office said.

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