TARIFF TOLL
The San Jose Mercury News editorializes against the steel tariffs, with a California angle:
But President Bush's steel tariffs, which were intended to score political points in key manufacturing states, have already proven to be bad economics in California. They've hurt a slew of small, struggling manufacturers and even threatened to bust the budget for retrofitting the Bay Bridge.
Worse, if the president refuses to lift the tariffs, which the World Trade Organization ruled were illegal on Monday, locally grown produce from avocados to oranges, lemons and rice, could end up rotting in shipping containers, the victims of retaliation in a looming trade war. Other California products such as clothes and machinery could be held hostage as well.
The steel tariffs were always about electoral politics -- not economics. They amounted to a giveaway to antiquated and inefficient steel producers in states such as Pennsylvania, Ohio, Michigan and West Virginia, which Bush needs to win to get re-elected. In the tug of war between the president's economic advisers, who opposed the tariffs, and his political advisers, who favored them, the latter prevailed.
The tariffs have given breathing room to some beleaguered steel markers and saved some jobs in that industry. But they've hurt the makers of everything from washing machines to auto parts, who have had to pay higher prices for steel. The higher prices dampen hiring and, ironically, accelerate the migration of jobs overseas.
The Rove Tariffs, as Andrew Sullivan calls them, don't just hurt California, a state Bush won't win anyway. The tariffs hurt the American economy as a whole, they hurt America's credibility abroad, and they definitely hurt the administration's credibility on economic issues. If there's one thing Candidate Bush appeared to believe in his heart of hearts, it was that free trade is good. If you can't trust him on a small, obvious policy issue like this one, how can you trust him on more difficult questions?