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Soft Lumber Tariffs are a Bad Idea – Tariffs are Not the Solution

Soft lumber Tariff, Trade, International Trade, Trump
 
The Trump administration announced last Monday (April 24, 2017) that it would impose new tariffs on Canadian Softwood Lumber Imports, escalating a longstanding conflict with America’s second-largest trading partner.

Bad Idea: We have forgotten that we are in this together.
I believe this is a Dumbass Idea. Tariffs are not the solution to the USA’s manufacturing lack of competitive capabilities. We have an anti-logging mentality throughout our country. Too many mills and processors have not invested in their own infrastructure. We have high corporate and individual taxation (especially when adding state based and sales-based taxation). We spend more than we raise. We have a polarized citizenry that views our economy and Republic with different filters. We have forgotten that we are in this together.

Soft lumber Tariff, Trade, International Trade, TrumpWe are out of balance in who we are and what we believe. We use shortcuts because the hard work of really seeking better outcomes is too difficult and likely spreads over an election cycle. We are hypercritical of our opponents and we appear to forget basic real world economics.

I was hopeful that President Trump would actually understand these complications. In all candor, as each day passes my optimism fades. I didn’t have to support him to want him to succeed once he prevailed. And it is counter-intuitive to want him to fail now as that only harms our great Nation.

Regardless this is simply another example of what I believe to be mistaken actions that will harm our citizens and ultimately erode our reputation as an open market.


Daniel’s Note:
“The Canada–U.S. softwood lumber dispute is one of the largest and most enduring trade disputes between both nations. This conflict arose in 1982 and its effects are still seen today. British Columbia, the major Canadian exporter of softwood lumber to the United States, was most affected, reporting losses of 9,494 direct and indirect jobs between 2004 and 2009.

The heart of the dispute is the claim that the Canadian lumber industry is unfairly subsidized by federal and provincial governments, as most timber in Canada is owned by the provincial governments. The prices charged to harvest the timber (stumpage fee) are set administratively, rather than through the competitive marketplace, the norm in the United States. In the United States, softwood lumber lots are privately owned, and the owners form an effective political lobby. The United States claims that the Canadian arrangement constitutes an unfair subsidy, and is thus subject to U.S. trade remedy laws, where foreign trade benefiting from subsidies can be subject to a countervailing duty tariff, to offset the subsidy and bring the price of the commodity back up to market rates.” 1

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