US Trade adviser berates Samsung & LG
Newly appointed (to a just-created position) Director of the White House Trade Council, Professor Peter Navarro recited the administration’s ‘unfair trade practices’ rhetoric against Samsung Electronics and LG Electronics (066570.KS) in reference to their competition with Michigan based Whirlpool (WHR). "I am amazed by how hard it is for our companies to compete on a level playing field. This heartland of America icon is grappling with a practice called country hopping. Two of the South Korean competitors, LG and Samsung, simply move the production to another country each time Whirlpool wins anti-dumping cases against them. Such country hopping has happened twice to Whirlpool already. LG and Samsung have moved from China to Vietnam and Thailand. This is the kind of trade cheating that must be stopped. It undermines the whole international order, even as it puts thousands of Americans on the unemployment line. It imposes millions of dollars of losses on companies like Whirlpool."
Of course, his comments did not mention the US anti-dumping duties of 52.5% on Samsung and 32.1% on LG that were imposed in December as a result of a petition from Whirlpool, based on the concept that the two competitors were selling washing machines at lower than ‘normal’ prices in the US, or the fact that when the US Tax Policy Center commented that the new administration’s economic plan would both reduce Federal revenue by $6 trillion and lower long-term growth, Navarro stated that the analysis demonstrated “a high degree of analytical and political malfeasance”. He followed the Peterson Institute’s comments that the plan would cost millions of Americans their jobs with “(the Peterson Institute) weave a false narrative and they come up with some phony numbers” and when 370 economists signed a letter warning against Trump’s economic policies last November, Navarro stated that the letter was “an embarrassment to the corporate offshoring wing of the economist profession who continues to insist bad trade deals are good for America.”
While we are as non-political as is possible, we see such rhetoric as a waste of time. Rather than cry about what other companies and countries are doing to US companies, wouldn’t it be a bit more logical to retrain workers, develop new products, and generally work toward improving the ability of the US to compete, rather than making statements that are obviously placed to destabilize relationships with trade partners in preparation for a renegotiation of trade deals. If you think that the deals are not good for America, then sit down and start to renegotiate. Putting a low-grade economist with an obvious political agenda in the spotlight does little to work toward a better agreement. If you are going to try to bully your opponent into a new agreement, make sure you and the public know what the upside and downside could be before you start mouthing off in the press. JOHO
Of course, his comments did not mention the US anti-dumping duties of 52.5% on Samsung and 32.1% on LG that were imposed in December as a result of a petition from Whirlpool, based on the concept that the two competitors were selling washing machines at lower than ‘normal’ prices in the US, or the fact that when the US Tax Policy Center commented that the new administration’s economic plan would both reduce Federal revenue by $6 trillion and lower long-term growth, Navarro stated that the analysis demonstrated “a high degree of analytical and political malfeasance”. He followed the Peterson Institute’s comments that the plan would cost millions of Americans their jobs with “(the Peterson Institute) weave a false narrative and they come up with some phony numbers” and when 370 economists signed a letter warning against Trump’s economic policies last November, Navarro stated that the letter was “an embarrassment to the corporate offshoring wing of the economist profession who continues to insist bad trade deals are good for America.”
While we are as non-political as is possible, we see such rhetoric as a waste of time. Rather than cry about what other companies and countries are doing to US companies, wouldn’t it be a bit more logical to retrain workers, develop new products, and generally work toward improving the ability of the US to compete, rather than making statements that are obviously placed to destabilize relationships with trade partners in preparation for a renegotiation of trade deals. If you think that the deals are not good for America, then sit down and start to renegotiate. Putting a low-grade economist with an obvious political agenda in the spotlight does little to work toward a better agreement. If you are going to try to bully your opponent into a new agreement, make sure you and the public know what the upside and downside could be before you start mouthing off in the press. JOHO
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