On Wednesday’s WSJ Opinion Page Wednesday, Pete Du Pont argues persuasively against steel tariffs supported by the US steel industry, the US-ITC, and President Bush:

Let’s be plain: Steel tariffs are a bad idea–bad for the steel industry; bad for governments that use steel in bridges and other public infrastructure projects (not to mention all the steel used by the military); bad for consumers, who will have to pay more for not only cars but all products that use steel; and bad for taxpayers, who will have to cough up billions of dollars to cover additional industry subsidies.

Hey, I don’t want steel workers to lose their jobs — just as I don’t want to see domestic catfish farms lose money — but protectionism is just a bad idea, plain and simple. Du Pont drives home the point:

The bad news is the cost of protectionism to the consumer and the taxpayer. The Institute for International Economics in Washington estimates that the cost of imposing 20% tariffs on imported steel would be $2.4 billion in the first year and $7 billion over the four years the ITC recommended. It would save 7,300 steel jobs, at a cost of $326,000 per job. Of course somebody–taxpayers or consumers–has to pay the $7 billion.

[…] A healthy American economy requires aggressive competition in the international marketplace rather than withdrawal behind tariff barriers. Protection of the domestic steel industry against foreign competition will ultimately mean obsolescence in the U.S. steel industry and the loss of the very jobs protectionists seek to save.

Surely the administration understands all of this. But whether it will act on that understanding is something else. We will know by Valentine’s Day.

Now, Bush has done a great job running the war, no doubt about it; but the rumblings about his buddy-ism are getting louder — and much of it’s coming from the right. Du Pont notes that on June 4, Bush signed a section 201 complaint under U.S. trade laws, allowing him to impose temporary tariffs or quotas on imported steel — even though Section 201 complaints are usually filed by corporate executives, not (as Du Pont points out) the president of the United States. Similarly, Rich Lowry (see below) wonders if Bush’s oil ties will make him reluctant to disrupt OPEC (and its price “stabilizing”). And that stimulus package, giving tax money back to Enron….yikes…

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