Unclean Hands: America's Protectionist Policies

Unclean Hands: America's Protectionist Policies by Stuart Anderson The author formerly was director of trade and immigration studies at the Cato Institute. American policymakers often justify trade barriers against other countries on the premise that the United States practices free trade while other countries erect trade barriers and engage in unfair trade practices. Claiming to favor "free but fair trade," they propose that America keep its markets open only to countries that dismantle their trade barriers. But in fact American policymakers often erect barriers and indulge in the kind of unfair practices that they are fond of denouncing. Russia's Ambassador to the United States, Yuri Vorontsov, at least was honest when his government increased its tariffs on American poultry. He delivered a forthright defense of protectionism, noting that "the cost is on the shoulders of the Russian consumer, as usual."1 He did not claim to be reacting to American protectionism. But if he follows the example of U.S. policymakers, he might well use this excuse in the future. American policymakers use a variety of practices, such as antidumping laws, to re-strict imports -- often in the name of "fair trade." Such restrictions usually are at the behest of American special interests seeking to restrict their competition. The first and foremost result of these practices is to harm American consumers. If the United States simply eliminated all tariffs and quantitative restrictions on imports, the net welfare gain to consumers would be $15.49 billion a year, according to a 1995 U.S. International Trade Commission report.2 (See Table 1.) That is probably a conservative estimate. Economists Gary Clyde Hufbauer and Kimberly Ann Elliot placed the total costs of protectionism in 1990 at $70 billion.3 American consumers, families, and particularly businesses that rely on imports as raw materials or components for production would benefit significantly if the United States unilaterally