Making trade war less secret
By ERNEST F. HOLLINGS, former U. S. senator
2010 -- Summarizing my response to Vice President Biden at the Library
Dedication, I noted that the Vice President was totally familiar with
the trade war and that we were losing more jobs to off-shoring than the
recession. The media and the pundits give "top secret" treatment
to the trade war and I used the occasion to get the trade war into the
We are engaged in globalization, which is nothing more than a raging trade war with production looking for a cheaper country to produce. Japan started the trade war for market share by closing its market, subsidizing its manufacture, selling its export at cost, and making up the profit in the closed market. My 2005 Lexus that sold for $35,000 has a similar car selling in Tokyo the same week for $48,000. Now, Toyota is #1 with GM bankrupt. China enlarged the trade war to investment, research, technology, development, production, jobs - to the total economy. The best of research, Microsoft, is now in China. The best of technology, Intel, is being developed in China. GM produces more cars in China than in the United States, and the recent Fortune 500 listing of the largest corporations has two in the first ten from the United States, Wal-Mart and Exxon Mobile, but four in China. The listing of largest banks includes four in China, with U. S. banks in bailout. China is the superpower in the economy war but the United States arrogantly acts like we are in charge, calling for "free trade," "protectionism."
Obama constantly brags that he is moving in the right direction, but he
is squatting - not moving at all on trade; failing to enforce our trade
laws, and cautioning against "protectionism." The United States
was founded in a trade war. The Mother Country forbade manufacturing in
the colony and required all exports to be carried in English bottoms.
The Revolution was definitely for freedom, but the forefathers were interested
in trade more than freedom. Article I, Section 8, of the Constitution
of 1787 called on Congress to regulate both domestic and foreign commerce.
It wasn't until six years later that we amended the Constitution to provide
for freedom of speech, religion, press and assembly. After adopting a
seal, the first bill to pass the Congress in its history on July 4, 1789,
was a protectionist tariff. And we financed and built these United States
into an industrial power with "protectionism." We didn't pass
the income tax until 1913. In 1900 the colony was richer than the Mother
Country by $25 billion and had a GDP double the GDP of Germany and Russia
combined, causing Teddy Roosevelt to exclaim: "Thank God I'm not
a Free Trader."
at a battery plant President Obama was emphasizing the need to go to green
jobs. Germany this minute is building a windmill plant in Charleston.
Manufacturing the parts in Germany, they'll be shipped to Charleston at
a cost of 3% with a 19% German VAT rebated. Highballing the cost of producing
parts in Germany, the Charleston plant will pay no more than 1% corporate
tax. Producing windmills in Charleston 15% cheaper than any domestic production,
Germany is already coppering the green jobs that the President calls for.
Senator Hollings of South Carolina served 38 years in the United States Senate, and for many years was Chairman of the Commerce, Space, Science & Transportation Committee. He is the author of the recently published book, Making Government Work (University of South Carolina Press, 2008).
© 2010, Ernest F. Hollings. All rights reserved. Contact us for republication permission.
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