Obama Administration’s Protectionism Draws Criticism

President Obama announced a few days ago that the U.S. will levy three year tariffs on all car and light truck tires imported from China. In the current global economic crisis, when recovery is still uncertain, the Obama administration has implemented a policy with obvious protectionist qualities. Criticisms from American experts and from the U.S. media are mounting.

One after the other, American economists argued that Obama’s sanctions against Chinese tires are meant to cater to domestic political pressures. Additionally, economists have claimed that this behavior is completely protectionist and thus hindering the promotion of free trade. Economists say that, in this time of economic recovery, the tariffs will harm not only the U.S.’s interests but also those of the entire world.

C. Fred Bergsten, of the Peterson Institute for International Economics, has claimed that the Obama administration does not have a clear trade policy. He has said, “They have indicated rhetorically their opposition to protection.” He stressed that if the Obama government does not correct this policy, they will have no way of fighting the pressures of protectionism.

Rutgers University Professor of Economics Thomas Prusa argues that, under this tire tariff policy put forth by the Obama administration, for every job gained, twenty-five jobs will be lost. This means a total of 25,000 jobs lost in the United States due to the tire tariffs. With unemployment rates in the U.S. high and not yet falling, this kind of protectionist behavior will only cause the U.S. job market go from bad to worse.

Eswar Prasad, a professor at Cornell University, has said that the protectionist nature of this trade policy is a risky strategy. In order to satisfy a few labor organizations, Obama has pushed Chinese-U.S. relations to the brink of crisis. Prasad pointed out that if the friction between China and the U.S. heightens, this could destroy the entire global trade structure, abruptly halting the world’s slow attempts at economic revival.

Derek Scissors, an economist at the Heritage Foundation, told Xinhua journalists that at this sensitive time, the U.S. must put an end to its sanctions targeted at China and must clearly demonstrate a cooperative trade policy.