Comments on: Staid of the Union http://www.manufacturethis.org/2008/01/29/staid-of-the-union/ Just another WordPress weblog Sat, 22 Nov 2008 10:11:22 +0000 http://wordpress.org/?v=2.1.2 By: David S http://www.manufacturethis.org/2008/01/29/staid-of-the-union/#comment-13198 David S Wed, 30 Jan 2008 17:04:22 +0000 http://www.manufacturethis.org/2008/01/29/staid-of-the-union/#comment-13198 Currently domestic manufacturers pay income taxes to both the federal and state governments. They pay payroll taxes to the federal government and property taxes to local governments. In short they are heavily taxed. But goods made in China are taxed very little if at all. That's like reverse protectionism, giving the advantage to Chinese made goods while punishing American made goods. That only make sense if the objective is to destroy American industry. Unfortunately that seems to be exactly what is happening. Our constitution clearly gives government authority to levy taxes on imports. Why can't we reduce taxes on American manufacturers and levy an import tax on foreign made goods? We did that for many years. Some people will say we can't levy tariffs because the Smoot Hawley tariff caused the great depression. But that is not true. The depression began before Smoot Hawley was passed so it could not have caused the depression. Also the Fordney McCumber tariff of 1922 raised rates nearly as high as Smoot Hawley did but no recession followed. It is totally foolish to think that American workers and American manufacturers can compete with buck-an-hour labor in China. It will not happen. Currently domestic manufacturers pay income taxes to both the federal and state governments. They pay payroll taxes to the federal government and property taxes to local governments. In short they are heavily taxed. But goods made in China are taxed very little if at all. That’s like reverse protectionism, giving the advantage to Chinese made goods while punishing American made goods. That only make sense if the objective is to destroy American industry. Unfortunately that seems to be exactly what is happening.

Our constitution clearly gives government authority to levy taxes on imports. Why can’t we reduce taxes on American manufacturers and levy an import tax on foreign made goods? We did that for many years.

Some people will say we can’t levy tariffs because the Smoot Hawley tariff caused the great depression. But that is not true. The depression began before Smoot Hawley was passed so it could not have caused the depression. Also the Fordney McCumber tariff of 1922 raised rates nearly as high as Smoot Hawley did but no recession followed.

It is totally foolish to think that American workers and American manufacturers can compete with buck-an-hour labor in China. It will not happen.

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