U.S. President Barack Obama's decision to impose punitive tariffs on tires imported from China has caused wide disappointment from American industries.
Roy Littlefield, executive vice president of the Tire Industry Association which opposes the tariff decision announced last Friday, said it would not save American jobs but only cause tire manufacturers to move production to another country with less strict environmental and safety controls, with less active unions and lower costs than the United States.
The sanction case was originally brought up by the United Steelworkers union in April.
The tire industry, however, did not join the case -- a tacit recognition that it has long ago left the U.S. market for the low-end tires at issue.
The powerful U.S. Steelworkers union, which represents workers at major U.S. tire manufacturers, filed a petition against China in April for import relief and won a favorable ruling from the U.S. International Trade Commission (ITC).
The commission panel recommended that Obama impose a 55-percent tariff on the Chinese tire imports which would be reduced to 45 percent in the second year and 35 percent in the third year before being removed.
President Obama has come under fierce pressure to introduce punitive tariffs on tire imports, amid warnings that a surge in the China-made goods had cost more than 5,000 jobs in the United States.
The new tariffs, on top of an existing 4-percent tariff on all tire imports, take effect on Sept. 26. The tariffs will soar by a further 35 percent in the first year, 30 percent in the second and 25 percent in the third.
The American Coalition for Free Trade in Tires, a pro-business group, expressed disappointment in Obama's decision.
"We are certainly disheartened that the president bowed to the union and disregarded the interests of the thousands of other American workers and consumers," said Marguerite Trossevin, legal counsel to the coalition.
"These tariffs are unwarranted. It's troubling that the Administration would invoke an import surge safeguard over the objections and in response to falling imports. Not a single U.S. tire company supports these taxes," said David Spooner of Squire, Sanders & Dempsey, counsel for the Chinese tire industry in a statement.
Vic Delorio, executive vice president at GITI, the largest manufacturer of tires in China, said he was "deeply disappointed" by the presidential decision.
"By taking this unprecedented action, the Obama administration is now at odds with its own public statements about refraining from increasing tariffs above current level," Delorio said.
"This decision will cost many more American jobs than it will create. It will also increase costs for, and take away choices from, American consumers," Delorio said.
U.S. media also expressed their concern about the decision.
"President Obama's action stands in contrast to that of his predecessor. President George W. Bush rejected four ITC recommendations for tariffs against China," an article from the Wall Street Journal said.
A report from the Associated Press said that the punitive tariffs on all car and light truck tires coming into the United States from China may placate union supporters who are important to the president's health care push.
The decision came as U.S. officials were working with the Chinese and other nations to plan an economic summit of the Group of 20 in Pittsburgh, to be held on Sept. 24-25. China will be a major presence at the meeting, and the United States will be eager to show that it supports free trade.
(Xinhua News Agency September 13, 2009)
