 By Chuck Thompson, originally published in the October 2011 Socionomist |
Protectionism has appeared this year in the form of threats by multiple nations against one another. China is at the center of many of the disputes.
In June, China threatened an outright trade war with the European Union if the EU moves ahead with plans to include foreign airlines in its emissions limits.4 (In September, the International Air Transport Association, which represents more than 230 airlines, pressed the EU to postpone the emissions legislation until the airline industry has emerged from its downturn.5)
Solar energy has become a point of conflict between China and the U.S., where lawmakers and union leaders are asking the Obama administration to file unfair-trade complaints against China because of the way it subsidizes clean-energy companies. The request comes following the collapse of the U.S. solar company Solyndra LLC, which went dark despite $535 million in loan guarantees from the U.S. Energy Department. Last year, China gave $30 billion in credit to its largest solar manufacturers—about 20 times the amount that manufacturers in the U.S. received. Thomas Conway, international vice president of the United Steelworkers, said the U.S. “should not sit back and say we are afraid to start a trade war.” He added, “We are in a trade war, and we are losing.”6
Poultry tariffs have become another bone of contention between China and the U.S. On September 20, the U.S. accused China of violating international trade rules when it imposed tariffs—ranging from 50 to 100 percent—on U.S. chicken exports. China imposed the tariffs last September on Tyson Foods, Pilgrim’s Pride, Keystone Foods and many smaller companies. The World Trade Organization says resolving the dispute may take up to 24 months.7
In the November 1992 issue of The Elliott Wave Theorist, Robert Prechter noted that depressions make trade wars “as inevitable as they are suicidal. … Depressions force regions of allegiance to contract, and trade war is one of the typical results.”8■
Citations
4Milmo, D., & Harvey, F. (2011, June 6). China threatens trade war over EU emissions trading scheme. The Guardian, Retrieved from http://www.guardian.co.uk/environment/2011/jun/06/china-trade-war-emissions-trading-airlines.
5So, C. (2011, September 21). Airlines seek to delay emissions trading scheme. South China Morning Post, Retrieved from http://topics.scmp.com/news/china-business-watch/article/Airlines-seek-to–delay-emissions–trading-scheme.
6McQuillen, W. (2011, September 23). Blame-China chorus grows as Solyndra falls amid imports. Bloomberg, Retrieved from http://www.bloomberg.com/news/2011-09-23/blame-china-chorus-grows-as-solyndra-fails-amid-cheap-imports.html.
7Rugaber, C.S. (2011, September 20). US files complaint against Chinese chicken tariffs. The Miami Herald, Retrieved from http://www.miamiherald.com/2011/09/20/2416298/us-files-complaint-against-chinese.html.
8Prechter, R. (1992, November). Cultural trends: protectionism. The Elliott Wave Theorist.
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