Can Doing What Seems to Be the Right Thing Turn Out to Be the Wrong Thing?

Leo Gerard of the United Steelworkers
union is one of America's most progressive and outspoken labor leaders.
I met him at a Cornell University conference that brought environmental
organizations and labor unions together to fuse a forward looking consensus
on the need for green jobs as key to the transformation of our declining
industrial base.

A union blog speaks of us being
in the best of times and the worst of times. The best because we finally
have a Democratic president sensitive to labor concerns. The worst because
American workers are up against hard times as unemployment grows because
of a financial crisis that labor had no role in. Among the trends
cited: "30
years of stagnant and declining wages while workers' productivity climbed
by 75%; lower take home pay than in 1973; Yawning inequality."

Yet for all
the union's activism and militancy, it has also been looking for someone
to blame for this situation. Rather than focus on Wall Street's predatory
practices or financing job outsourcing, it has turned its anger
on workers on the other side of the world. China has become "the enemy."
It is seeking protectionism in the belief that that can save American
jobs.

Their target is tire companies in China that manufacture the least expensive
tires on the market for cars and light trucks and sell them in America.
The union argues that its imports are stealing American jobs and "disrupting
the market" and has petitioned a government body, the International
Trade Commission (ITC), to slap limits on them.

Bloomberg News
reports: "The Chinese
import surge has been a significant factor that has led to the idling
of factories," Leo Gerard, president of the United
Steelworkers, told reporters. The union represents about 15,000 tire
workers at 13 plants including those owned by Bridgestone Corp. and Goodyear
Tire and Rubber Co."

The ITC, set up under our trade
laws, has now, by a 4-2 vote, agreed with the union and then went even
further recommending stiff tariffs on all Chinese made tires in a remedy
sent to President Obama. Perhaps unknowingly, the ITC decision also
puts tariffs on Goodyear tires made in China, potentially hurting a
US company as well. (1 out of every 6 tires manufactured by US firms
are made in China!)

Explains the news service:
"The president has the final decision over whether to take action
or disregard the commission's recommendation, and that will be due
in September."

Gerard sees the decision as
a big victory but the logic is illogical and illustrates the dilemma
of trying to fight our economic decline in an age of globalization by
taking refuge in protectionist policies that often lead to counter attacks,
in this case, from the one country that has kept the US economy alive
by buying our treasury bills and debt.

Without China's financial
support, we would be in far more dire straits, perhaps a deeper depression.
Everyone knows that.

What's most revealing is
that that none of the US-based tire companies have joined the union
in this China bashing. If their business was at risk from predatory
trade practices from China, they would speak up, but they know that
tire imports from China constitute only 11% by value of the US tire
market.

Another reason for the silence
of US companies: they had long ago stopped producing lower-cost so-called
"Tier 3" tires and instead opted to manufacture premium more expensive
and more profitable products which are not in the same category, hence,
not directly competitive. Some of these companies benefit as well because they
import the third tier economy-priced tires from China for their
own US distribution networks.

When US brands got out of the
cheaper so-called replacement-tire low-profit market, China got into
it, including working through these US manufacturers' American distribution
networks and dealership which hire thousands of American workers.
They service cost-conscious US consumers who can't afford higher priced
brands. These consumer will be hurt if the Steelworkers and ITC prevail
in this wrong-headed move.

And who are they? They
are the union's own constituency, American workers who are coping
with high unemployment levels and all sorts of economic distress because
of the collapse of our financial system. Why victimize them further?

Stopping Chinese firms from
manufacturing low-cost tires and selling them here will not create
new jobs in America or turn the economy around.

Then, why is the union advocating
it? Clearly to do something, to be perceived symbolically as
fighting for its members by taking a popular "Buy America" stand
even though there are no comparable American tires at that price point
that are made here or even sold here.

The likely outcome is that
if Chinese made tires are sanctioned, imports of tires made in Venezuela
and other countries will replace them. Who will benefit? Not American
workers!

Instead the Chinese work force
with 20 million out of work because of the economic crisis will face
even more painful job losses that will likely enrage them, and then
put pressure on the Chinese government to strike back, perhaps with
more pressure on the American dollar, or other US businesses there.

As the saying goes, what's
good for the goose is good for the gander.

Many in China already resent
US economic bullying and blame Wall Street for selling them junk loans
and infected financial products that have caused vast economic losses.
(Even as the US blames China for selling us infected peanuts or risky
toys.)

To be honest, there is plenty
to find fault with on all sides.

China-made tires meet US safety
standards. If these more affordable tires go up in price, consumers
would likely replace them less, leading to real safety worries.

So, let's stop reducing this
problem to black and white, right and wrong, to demonize the "foreigners"
with whom we are, like it or not, in an economically co-dependent relationship.
In this industry there are both American owned firms in China and Chinese
firms doing business in America.

The Steelworkers deserve support
in their fight for economic fairness and new laws to help them organize.
They deserve respect for their advocacy of an environmentally sustainable
economy.

Their 'save our tires'
tactic, however, is a throw back, a step in the wrong direction and
likely to hurt all sides in our economic relationships. We need each
other to achieve economic stability.

Instead of gaining jobs for
Americans, this measure could lose them. 500 US businesses could be
hurt if this "remedy" goes through. Also, bear in mind, those US
tire plants that were closed down before the Chinese imports from China began.

We need to ask: whom does protectionism
really protect? When things are so bad, why make them worse?