NCPA - National Center for Policy Analysis


September 12, 2008

West Virginia and Ohio Democratic senators Robert Byrd and Sherrod Brown have succeeded in getting Japan to slap another year of punitive duties on some U.S. products because of their attempts to rig trade rules for their business buddies, says the Wall Street Journal.

Specifically, Japan's cabinet decided in August to add a 10 percent tariff on ball bearings and tapered roller bearings that could knock U.S. producers out of competition in Japan.  This decision follows a European Union mandate to extend punitive duties on a range of other American products.  The tariffs hit just as U.S. exports have become the main source of American growth amid the housing slump and credit crunch.

Europe and Japan are hurting their own consumers here, but they are in the legal right, says the Journal.  However:

  • The Byrd Amendment is a toxic 2000 law that distributed tariff money not to the U.S. government but directly to U.S. companies that complained about "unfair" foreign competition.
  • The World Trade Organization ruled in 2002 that the Byrd Amendment violated global trade rules and Congress finally repealed it in early 2006.
  • But the disbursements continue to complaining U.S. companies for as many years as it takes to collect duty due for alleged dumping of foreign products before October 1 of 2007; last year along the payout was more than $264 million.

Worse, Sens. Byrd and Brown are trying to resurrect the law, probably by attaching it to a "must-pass" piece of legislation.  Ironically, that is how it was passed the first time, and look where it had gotten us, adds the Journal

Source: Editorial, "An Expensive Byrd," Wall Street Journal, September 11, 2008.

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