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Trade War With Canada Begins

Mike

Well-known member
Trade Wars Launched With Ruses, End Runs
Outrage in Canada as U.S. Firms Sever Ties To Obey Stimulus Rules

By Anthony Faiola and Lori Montgomery
Washington Post Staff Writers
Friday, May 15, 2009

Is this what the first trade war of the global economic crisis looks like?

Ordered by Congress to "buy American" when spending money from the $787 billion stimulus package, the town of Peru, Ind., stunned its Canadian supplier by rejecting sewage pumps made outside of Toronto. After a Navy official spotted Canadian pipe fittings in a construction project at Camp Pendleton, Calif., they were hauled out of the ground and replaced with American versions. In recent weeks, other Canadian manufacturers doing business with U.S. state and local governments say they have been besieged with requests to sign affidavits pledging that they will only supply materials made in the USA.

Outrage spread in Canada, with the Toronto Star last week bemoaning "a plague of protectionist measures in the U.S." and Canadian companies openly fretting about having to shift jobs to the United States to meet made-in-the-USA requirements. This week, the Canadians fired back. A number of Ontario towns, with a collective population of nearly 500,000, retaliated with measures effectively barring U.S. companies from their municipal contracts -- the first shot in a larger campaign that could shut U.S. companies out of billions of dollars worth of Canadian projects.

This is not your father's trade war, a tit-for-tat over champagne or cheese. With countries worldwide desperately trying to keep and create jobs in the midst of a global recession, the spat between the United States and its normally friendly northern neighbor underscores what is emerging as the biggest threat to open commerce during the economic crisis.


Rather than merely raising taxes on imported goods -- acts that are subject to international treaties -- nations including the United States are finding creative ways to engage in protectionism through domestic policy decisions that are largely not governed by international law. Unlike a classic trade war, there is little chance of containment through, for example, arbitration at the World Trade Organization in Geneva. Additionally, such moves are more likely to have unintended consequences or even backfire on the stated desire to create domestic jobs.

Buy American


Take, for instance, Duferco Farrell Corp., a Swiss-Russian partnership that took over a previously bankrupt U.S. steel plant near Pittsburgh in the 1990s and employed 600 people there.

The new buy American provisions, the company said, are being so broadly interpreted that Duferco Farrell is on the verge of shutting down. Part of an increasingly global supply chain that seeks efficiencies by spreading production among multiple nations, it manufactures coils at its Pennsylvania plant using imported steel slabs that are generally not sold commercially in the United States. The partially foreign production process means the company's coils do not fit the current definition of made in the USA -- a designation that the stimulus law requires for thousands of public works projects across the nation.

In recent weeks, its largest client -- a steel pipemaker located one mile down the road -- notified Duferco Farrell that it would be canceling orders. Instead, the client is buying from companies with 100 percent U.S. production to meet the new stimulus regulations. Duferco has had to furlough 80 percent of its workforce.

"You need to tell me how inhibiting business between two companies located one mile apart is going to save American jobs," said Bob Miller, Duferco Farrell's executive vice president. "I've got 600 United Steel Workers out there who are going to lose their jobs because of this. And you tell me this is good for America?"

The United States is not alone in throwing up domestic policies assailed by critics as protectionist. Britain and the Netherlands, for instance, are forcing banks receiving taxpayer bailouts to jump-start lending at home at the expense of overseas clients. French President Nicolas Sarkozy initially insisted that his nation's automakers move manufacturing jobs home in exchange for a government bailout, but backed down after outrage surged among his peers in the European Union, of which France is a central member.

But the number of measures, both proposed and enacted, from the Obama administration and Congress in recent months has raised an alarm among foreign governments, pundits and news media outlets.
 

Sandhusker

Well-known member
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.
 

TexasBred

Well-known member
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

Govt entities do not pay taxes on purchases.
 

Sandhusker

Well-known member
TexasBred said:
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

Govt entities do not pay taxes on purchases.

Correct, but the entities that they buy from do. The employees of those entities do.
 

Silver

Well-known member
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

Even if it means cutting off your nose to spite your face, right?
 

burnt

Well-known member
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.


WELL THE DAMN FOOLS FROM SMITHVILLE BETTER HOPE THEY NEVER NEED ANY OF JOHNSONVILLE'S OIL.
 

TSR

Well-known member
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

I agree, at least as much as possible, in regards to buying from your own countrymen.
 

Mike

Well-known member
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

But if Johnsonville is buying goods from Smithville, the Smithville residents should at least reciprocate in a balanced fashion.

It gets even trickier when Johnsonville has natural resources that Smithville needs to produce their product.

Balance, my friend, balance.
 
A

Anonymous

Guest
TSR said:
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

I agree, at least as much as possible, in regards to buying from your own countrymen.

Yep- me too....One of the reasons I'm happy to see that new Administration has asked the Pentagon to relook at and reevaluate their procurement policy and bidding policy on equipment-planes- helicopters---many of which for the last few years the bids for have been awarded to foreign companies or foreign country owned companies- and/or built overseas....
 

Mike

Well-known member
There are no more exclusively "Made In USA" planes. :lol:

Even the new Boeing 787 is built almost everywhere else. :roll: :roll:

http://www.seattlepi.com/business/275465_japan27.html
 

TexasBred

Well-known member
Oldtimer said:
TSR said:
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

I agree, at least as much as possible, in regards to buying from your own countrymen.

Yep- me too....One of the reasons I'm happy to see that new Administration has asked the Pentagon to relook at and reevaluate their procurement policy and bidding policy on equipment-planes- helicopters---many of which for the last few years the bids for have been awarded to foreign companies or foreign country owned companies- and/or built overseas....

Really?? What? F-22's?? Apaches??FA-18's??
 

don

Well-known member
http://www.washingtonpost.com/wp-dyn/content/article/2009/05/14/AR2009051404241.html

protectionism will lead to more inefficiency and corruption which will lead to higher costs which will lead to higher taxes and taxpayer protest which will lead to the collapse of any constructive outcome. the world has changed and the usa will have to change with it.
 

Sandhusker

Well-known member
Mike said:
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

But if Johnsonville is buying goods from Smithville, the Smithville residents should at least reciprocate in a balanced fashion.

It gets even trickier when Johnsonville has natural resources that Smithville needs to produce their product.

Balance, my friend, balance.

I said that ANY government should buy….. That means I also believe that the Canadian government should buy from Canadians. Washington buys US products from the people that pay taxes to Washington and Ottawa buys Canadian products from the people that pay taxes to Ottawa. That is balanced and makes sense for the governments to do. Those businesses will pay taxes and the people they employ pay taxes – it’s just like a mail-in rebate for the government. Plus, the more those businesses go to their countrymen for their supplies, the larger the “rebate” grows.

Also, consider that the reason given that the US taxpayer should go deeper in debt to finance this spending spree was to help OUR economy. Not picking on Canadians, but I think somebody standing on the outside wanting a piece of the US taxpayer pie is out of line. If you want to talk fairness and not just share in the spoils, you need to mortgage your future, too. It’s kind of like going to a kegger, if you’re going to drink, you have to buy a cup.
 

MoGal

Well-known member
Sandhusker, every country thinks the American owes them prosperity, at our own people's peril.

I'm glad to see it. Bring it on. I am sick and tired and I do mean sick of it, that free trade instead of fair trade has been thrown around the world. Every country has been on the American teat for many, many years and its time to get off it. The american people have watched their jobs go to other countries and now in my own area even, jobs that used to start out at $11 are now down to $8 and who can support a family on that type of income? I sure hope all these people unemployed start raising hell with their congress but I sure would like to ask em where they were when congress was passing all these free trade agreements that exported jobs.

Next is do away with NAFTA as we aren't interested in the Luciferian one world order, send the illegal aliens home (or at least stop all their government benefits) and get rid of the Federal Reserve (not necessarily in that order either).
 
A

Anonymous

Guest
TexasBred said:
Oldtimer said:
TSR said:
I agree, at least as much as possible, in regards to buying from your own countrymen.

Yep- me too....One of the reasons I'm happy to see that new Administration has asked the Pentagon to relook at and reevaluate their procurement policy and bidding policy on equipment-planes- helicopters---many of which for the last few years the bids for have been awarded to foreign companies or foreign country owned companies- and/or built overseas....

Really?? What? F-22's?? Apaches??FA-18's??

The selected replacement of the Bush Administration to replace the Marine One fleet was the British-Italian AgustaWestland AW101...

They also gave the what could end up being $100 BILLION contract for the complete replacement of the Multi-Role Tanker Transport (MRTT) (179 planes) aircraft to AIRBUS (EADS) which is a conglomerate which is both private and government owned by Germany, France, the United Kingdom, and Spain. A company which has a terrible history of meeting completion dates- and of which the US has a WTO trade complaint filed against because of the foreign government subsidies they receive which gives them a bidding advantage over US plane manufacturers....

Another lesser contract was awarded in June 2006- when the United States Army awarded a $3 billion contract to Eurocopter (a subsidiary of eads- Germany/France/Spain/UK) to purchase up to 352 uh-145 helicopters.

One United Arab Emirates plant is the sole producer for many components for the Abrams Main Battle Tank.

There is now only one company left in the U.S. that manufactures roller cutters for heavy steel or armored plate. Because of this limited existing domestic manufacturing capability- when the call came in for more armor for American humvees in Iraq- besides Rummys stonewalling the military says it took almost a year to produce that armor plate.
I wonder how many soldiers died from that during that year :???:
 

burnt

Well-known member
Well roll over Beethoven!!! Two dyed-in-the-wool Republicans suddenly and passionately embracing Obamonomics! :lol: :lol: :lol: Golly, such radical conversions bout nuff to bring a tear to my eye!! :lol: :lol: So started out oldtimer. Hey oldtimer, move over - you got yer old rcalf buddies sandhusker and mogal comin' on board the good ship Libertarianism!! :lol: :lol:
 

Sandhusker

Well-known member
burnt said:
Well roll over Beethoven!!! Two dyed-in-the-wool Republicans suddenly and passionately embracing Obamonomics! :lol: :lol: :lol: Golly, such radical conversions bout nuff to bring a tear to my eye!! :lol: :lol: So started out oldtimer. Hey oldtimer, move over - you got yer old rcalf buddies sandhusker and mogal comin' on board the good ship Libertarianism!! :lol: :lol:


What part of what I said to you have a problem with?
 

Mrs.Greg

Well-known member
Sandhusker said:
Mike said:
Sandhusker said:
Any government should buy from the businesses of it's countrymen, it's in their best interest to do so - it generates the taxes that the government needs to run.

If you're going to help the economy of Smithville, you spend your money in Smithville, not Johnsonville.

But if Johnsonville is buying goods from Smithville, the Smithville residents should at least reciprocate in a balanced fashion.

It gets even trickier when Johnsonville has natural resources that Smithville needs to produce their product.

Balance, my friend, balance.

I said that ANY government should buy….. That means I also believe that the Canadian government should buy from Canadians. Washington buys US products from the people that pay taxes to Washington and Ottawa buys Canadian products from the people that pay taxes to Ottawa. That is balanced and makes sense for the governments to do. Those businesses will pay taxes and the people they employ pay taxes – it’s just like a mail-in rebate for the government. Plus, the more those businesses go to their countrymen for their supplies, the larger the “rebate” grows.

Also, consider that the reason given that the US taxpayer should go deeper in debt to finance this spending spree was to help OUR economy. Not picking on Canadians, but I think somebody standing on the outside wanting a piece of the US taxpayer pie is out of line. If you want to talk fairness and not just share in the spoils, you need to mortgage your future, too. It’s kind of like going to a kegger, if you’re going to drink, you have to buy a cup.
Your SOOOOO full of Shite Sandy,from the day I started here you've been pikin on the Canucks. Heres a tip take a trip outta WTF Nebraska,ask your tin foil hat wearin cousin Mogal to go with you,see some of the real world out there not just the garbage you like to read and fill yur pretty little heads with....Trade is here to stay amounst ALL countries. As for livin off the shirt tails of the US.....take some time to READ up on what YOUR country rely's on from NOT only Canada but NUMEROUS other countries. Trust me buddy you can wear those rose coloured glasses but that just proves you ain't seein the REAL light. AND DO NOT ask me a stupid question actually THINK about what written to you.

PLUS IF,and I mean IF hypo is actually Canadian maybe he can fill you in on some sense.Come on Hypo. Cut & paste just what the US is dependant on from Canada...here's a hint where to Start...the resource is in ALBERTA!!!!

I've NEVER in my life encountered such narrow mindeness :roll: :roll:
 
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