Full Version: It's only an International Treaty...
I've talked about protectionism before. I've talked about softwood lumber as well. But this really bakes my potato...
Basically, three and a half years ago the U.S. government decided to prop up it's own inefficient timber industry by imposing a large punitive tarriff on Canadian imports. Well, since Canada and the U.S. both signed a free trade agreement some years back, our government went to the WTO and said "excuse me, but the Americans aren't playing nice." What followed was three years of panels and arbitrators looking at the case, finding the U.S. actions illegal under NAFTA, and the U.S. government saying "we don't agree, we'll go to another resolution mechanism."
What happened this week is the U.S. appealed to the final instrument for multi-party resolutions left in NAFTA, the Extraordinary Challenge Committee. THey again ruled that the tarriffs were illegal, and ordered the U.S. to drop them and refund the $5 billion collected so far. Which is why the U.S. government is taking the brilliant legal position of We don't think so. What they are basically saying is "we won't accept any decision that rejects our claims, and if Canada wants to end this dispute they have to agree to OUR terms."
There are a lot of issues here. First and foremost (especially for me) is what position this leaves Canada in. An editorial I read suggested that Canada invoke Chapter 1905 of NAFTA; which would allow Canada to temporarily unilaterally withdraw priveledges granted the U.S. under NAFTA. Bruce Campbell (no, not THAT Bruce Campbell) suggests that these could include:
Normally I don't like to punish or blame Americans at large for the actions of their government; but in this case I can honestly say that I don't care. First of all, odds are nothing of the sort will happen. Second, I've read far too many posts here saying "America only needs to look after her own interests."
I guess I should ask some questions at some point, but allow me one more digression. The United States legally entered into a BINDING treaty, then ratified it. As far as I understand the Constitution, this treaty is considered U.S. Law at this point. More importantly, America is desperately trying to decorate itself as the champion of freedom, in rights and trade. At what point does all this bluster stop?
1. What, if anything, should the U.S. government do considering that the softwood lumber tarriffs are illegal under NAFTA?
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
QUOTE
The response from the office of the United States Trade Representative upon learning the Americans had lost another round in the softwood lumber dispute was short, to the point, and not at all unexpected.
"We are, of course, disappointed with the ... decision, but it will have no impact on the anti-dumping and countervailing duty orders given the ITC's November 2004 injury determination," said USTR spokesperson Neena Moorjani.
"We are, of course, disappointed with the ... decision, but it will have no impact on the anti-dumping and countervailing duty orders given the ITC's November 2004 injury determination," said USTR spokesperson Neena Moorjani.
Basically, three and a half years ago the U.S. government decided to prop up it's own inefficient timber industry by imposing a large punitive tarriff on Canadian imports. Well, since Canada and the U.S. both signed a free trade agreement some years back, our government went to the WTO and said "excuse me, but the Americans aren't playing nice." What followed was three years of panels and arbitrators looking at the case, finding the U.S. actions illegal under NAFTA, and the U.S. government saying "we don't agree, we'll go to another resolution mechanism."
What happened this week is the U.S. appealed to the final instrument for multi-party resolutions left in NAFTA, the Extraordinary Challenge Committee. THey again ruled that the tarriffs were illegal, and ordered the U.S. to drop them and refund the $5 billion collected so far. Which is why the U.S. government is taking the brilliant legal position of We don't think so. What they are basically saying is "we won't accept any decision that rejects our claims, and if Canada wants to end this dispute they have to agree to OUR terms."
There are a lot of issues here. First and foremost (especially for me) is what position this leaves Canada in. An editorial I read suggested that Canada invoke Chapter 1905 of NAFTA; which would allow Canada to temporarily unilaterally withdraw priveledges granted the U.S. under NAFTA. Bruce Campbell (no, not THAT Bruce Campbell) suggests that these could include:
QUOTE
The most obvious candidates for the withdrawal of benefits are the investment provisions — for example, (investor-state) privileges which allow U.S. corporations to sue Canadian governments, or the benefit extended under the deal that obligates Canada to share its energy resources with the U.S. in times of shortage.
Normally I don't like to punish or blame Americans at large for the actions of their government; but in this case I can honestly say that I don't care. First of all, odds are nothing of the sort will happen. Second, I've read far too many posts here saying "America only needs to look after her own interests."
I guess I should ask some questions at some point, but allow me one more digression. The United States legally entered into a BINDING treaty, then ratified it. As far as I understand the Constitution, this treaty is considered U.S. Law at this point. More importantly, America is desperately trying to decorate itself as the champion of freedom, in rights and trade. At what point does all this bluster stop?
1. What, if anything, should the U.S. government do considering that the softwood lumber tarriffs are illegal under NAFTA?
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
1. What, if anything, should the U.S. government do considering that the softwood lumber tarriffs are illegal under NAFTA?
The US Government should honor its treaty obligations, plain and simple.
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
None.
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
This is yet another example of American hubris. The neocons figure that, since we're the only superpower in the world, we can do anything we want. This is foolish, because we need the rest of the world to cooperate with us, but we're treating other countries like dirt.
The Canadian government should respond by playing hardball, hitting the US back as hard as possible in such a way as to single out some American industry for punishment. That will make it an internal battle between two special interests in Congress. Let the lobbyists take each other out for a change.
The US Government should honor its treaty obligations, plain and simple.
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
None.
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
This is yet another example of American hubris. The neocons figure that, since we're the only superpower in the world, we can do anything we want. This is foolish, because we need the rest of the world to cooperate with us, but we're treating other countries like dirt.
The Canadian government should respond by playing hardball, hitting the US back as hard as possible in such a way as to single out some American industry for punishment. That will make it an internal battle between two special interests in Congress. Let the lobbyists take each other out for a change.
QUOTE(Ultimatejoe @ Aug 13 2005, 03:47 PM)
1. What, if anything, should the U.S. government do considering that the softwood lumber tarriffs are illegal under NAFTA?
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
1.) If we've given our word to another nation or coalition of nations we have an obligation to obey stipulations whether we enjoy it or not.
2.) It doesn't have a place in any American institution.
3.) I'd put my faith in the World Trade Organization and other free trade countries to pressure America into backing down- if that does not work: boycott American-made products currently being imported into Canada.
QUOTE(Ultimatejoe @ Aug 13 2005, 02:47 PM)
1. What, if anything, should the U.S. government do considering that the softwood lumber tarriffs are illegal under NAFTA?
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
2. What place does this sort of "just try and stop me" protectionism have in the U.S. economy?
3. How do YOU as Americans reconcile this sort of behaviour with the hard-fought reputation as the land of the free, and the champion of freedom and liberty?
1. We need to follow any treaty we sign.
2. Its hard to tell what NAFTA covers and what I just found out the U.S.-Canadian Softwood Lumber Agreement which expired somewhere in the end of 2001 and beginning of 2002.
Here's a few links I found
COCHRAN ANNOUNCES RELIEF FOR U.S. SOFTWOOD LUMBER INDUSTRY COMMERCE DEPARTMENT FINDS CANADA DUMPS AND SUBSIDIZES LUMBER COCHRAN ANNOUNCES RELIEF FOR U.S. SOFTWOOD LUMBER INDUSTRY COMMERCE DEPARTMENT FINDS CANADA DUMPS AND SUBSIDIZES LUMBER
Softwood Lumber Agreement main page
U.S. - Canadian Softwood Lumber Agreement - in pdf format
U.S. - Canadian Softwood Lumber Agreement Amendment - in pdf format
U.S. - Canadian Softwood Lumber Agreement Amendment to the Softwood Lumber Agreement as settlement of the rougher headed lumber dispute - in pdf format
Interesting links, yet entirely irrelevant. The fact is that when there is a "dispute" over what NAFTA says or doesn't say, there are prescribed channels to resolve these disputes, involving the WTO and panels convened under NAFTA. In each and every case on Softwood Lumber these organizations have found that the DUMPING that the U.S. is using as a pretense for the illegal tarriffs does not exist. Under NAFTA there is no question.
While I tend to agree with you Ultimatejoe with the pretense when it comes to disputes. Like I said it is hard to figure out since the U.S.-Canadian Softwood Lumber Agreement was signed after the NAFTA treaty but also has expired now. So what actually is happening is hard to figure out, cause I did do a quick gander at the NAFTA agreement and while alot of things are expressly written when it comes to textiles and different things I couldn't find anything about lumber. I am not saying it is not covered just that is harder to figure out since the other agreement was done after NAFTA.
NAFTA
Edited to add:
This site shows the history of NAFTA & U.S.-Canadian Softwood Lumber Agreement and also the findings by WTO & NAFTA panels holding US was in the wrong for tariffs
Softwood lumber dispute
Softwood Lumber Trade
The highlighted area is why I said I have reservations especially since this is the only site that I could find that said soft lumber was excluded under NAFTA. That is all I am saying Ultimatejoe that I am not quite sure, because if it is correct that it was excluded in the NAFTA agreement was it only for that period of time or permanately if no other agreement was agreed upon. For the most part I am in agreement with you on this issue that I don't want our country using protectionistic practices.
NAFTA
Edited to add:
This site shows the history of NAFTA & U.S.-Canadian Softwood Lumber Agreement and also the findings by WTO & NAFTA panels holding US was in the wrong for tariffs
Softwood lumber dispute
QUOTE
The duties were applied separately following the expiration of the softwood lumber agreement between Canada and the U.S., which governed exports from April 1, 1996 to March 31, 2001.
Softwood Lumber Trade
QUOTE
In general, Americans and Canadians enjoy a favorable trade relationship as a result of the North American Free Trade Agreement (NAFTA). However, in May of 1996, under the U.S.-Canadian Softwood Lumber Agreement (SLA), softwood lumber was excluded from NAFTA and subjected to trade tariffs when imported to the U.S. Originally the SLA had little impact on MHI manufacturers, who rely on notched studs in the construction process. Notched studs were classified as a value-added product, and, along with other value-added lumber products like pre-drilled studs and rougher headed board, they managed to escape the trade tariffs the SLA imposed on Canadian softwood lumber imports.
The highlighted area is why I said I have reservations especially since this is the only site that I could find that said soft lumber was excluded under NAFTA. That is all I am saying Ultimatejoe that I am not quite sure, because if it is correct that it was excluded in the NAFTA agreement was it only for that period of time or permanately if no other agreement was agreed upon. For the most part I am in agreement with you on this issue that I don't want our country using protectionistic practices.
Over the protests of many Americans, the United States government pushed hard for NAFTA and got what it wanted. Now it decides that it doesn't want to play by the rules? This is an outrage.
1. There are two obvious choices. Play by the rules, or withdraw totally and permanently from NAFTA. Neither one is going to happen, and this kind of nonsense is going to go on endlessly. The first choice would hurt American business interests -- unacceptable. The second choice would require admitting that NAFTA is not always good for American interests -- unacceptable.
2. No place at all. In general, I like the idea of "free trade" among all nations. I also realize that it isn't that simple, and that international economics is way over my head. But this kind of pick-and-choose in an international treaty is bad for the USA because it makes us look like cheaters.
3. I don't think of the USA as a special place of freedom. There is no question that it is one of the better places in the world when it comes to individual liberty (as is Canada, of course), but it has no monopoly on it.
And it would be a good idea for the United States to play fair with the other Good Guys of the world before it loses even more friends.
1. There are two obvious choices. Play by the rules, or withdraw totally and permanently from NAFTA. Neither one is going to happen, and this kind of nonsense is going to go on endlessly. The first choice would hurt American business interests -- unacceptable. The second choice would require admitting that NAFTA is not always good for American interests -- unacceptable.
2. No place at all. In general, I like the idea of "free trade" among all nations. I also realize that it isn't that simple, and that international economics is way over my head. But this kind of pick-and-choose in an international treaty is bad for the USA because it makes us look like cheaters.
3. I don't think of the USA as a special place of freedom. There is no question that it is one of the better places in the world when it comes to individual liberty (as is Canada, of course), but it has no monopoly on it.
And it would be a good idea for the United States to play fair with the other Good Guys of the world before it loses even more friends.
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