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US Announces Trade Enforcement Action on Chicken Tariffs

This was rumored yesterday, and now we know: the US has filed another complaint against China at the WTO, this one over Chinese tariffs on US chicken producers.

The United States filed a complaint Tuesday with the World Trade Organization that says China violated international trade rules when it imposed tariffs last year on U.S. chicken exports.

U.S. Trade Representative Ron Kirk said the tariffs threaten 300,000 jobs in the U.S. poultry industry. The tariffs ranged from 50 to 100 percent, a U.S. trade official said. That means some Chinese importers paid as much as twice the price for U.S. chicken.

The case is one of several that U.S. trade officials have filed against China this year at the WTO. The United States has also filed complaints about Chinese tariffs on steel products and its subsidies of wind power equipment.

Exports of US chicken to China have dropped 90% since China imposed tariffs last September, at a cost of $1 billion a year. The tariffs were thought to be in retaliation for some of these other US actions, such as WTO complaints on Chinese steel and wind power products, and the imposition of a tariff, since backed up at the WTO, on illegally dumped Chinese tires.

At least there is some fleeting sense of the need to protect American industries from unfair trade practices from mercantilist nations. The ultimate version of this would be to label China as a currency manipulator, which manufacturing experts say could help the US add up to two million jobs. But this is at least a step.

Another step would be trade adjustment assistance to the workers who are victims of free trade deals. The Senate will actually take up a restoration of the expired TAA program this week, which includes job training and stipends to pay for health and other costs. This is seen by the White House as part of a package deal with three free trade agreements with Colombia, Panama and South Korea. However, organized labor doesn’t see it that way, and will continue to oppose the free trade deals despite the bone of TAA thrown to them. The fact that the bills are split, with TAA moving first, leads to the possibility that it will pass without the free trade deals. It also could lead to just the opposite.

Presumably, trade enforcement actions at the WTO will not soothe the anger with the NAFTA-style free trade deals either, especially as they would lead to lost jobs, according to expert analyses by groups like the Economic Policy Institute.

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David Dayen

David Dayen