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Protectionism Poses Worry

By bob mcgee – March 20, 2017
Cabinet of Donald Trump in the White House.

Whether the Trump Administration will promote “free and fair trade” worldwide or a “protectionist agenda” did not become any clearer during a G-20 meeting in Baden-Baden, Germany attended by the finance chiefs of the top 20 industrialized and emerging economies. But the finance chief for Japan called talk about the president’s alleged protectionist instincts both “exaggerated and made up.”

Still, the G-20 group did not reiterate a “resist all forms of protectionism” statement as issued during a similar summit last summer in China and some attendees, according to multiple reports, were said to be confused about the U.S.’s go-forward position on trade policy. Also at the meeting, at the insistence of the U.S. and Saudi Arabia, any mention of funding for climate change was dropped.  

It was reported that U.S. Treasury Secretary Steven Mnuchin promoted the president’s position of “free and free trade,” and the G-20 pledged to promote “fairness” on all economic growth initiatives.  

Mnuchin told the group, “It is not our [U.S.] desire to get into trade wars, it is our desire to deal with where there is imbalance in certain trade relations.”

Brazil’s finance chief told the G-20 group about his country’s failed protectionist measures that sparked a recession in the South American nation and strategic shift to a more open trade policy.  

Elsewhere last week, the Outdoor Industry Association took a stance in opposition against a proposal that would impose an industry-specific excise tax on outdoor products. The OIA rejected the concept and claims by those in favor of the so-called “Backpack Tax” that the outdoor industry does not pay its fair share of costs for conservation, access, and land management. Proponents of the added tax point to similar taxes on hunting and fishing products as a model.  

In its lengthy statement in opposition to the “Backpack Tax” proposal, the trade group said such a tax would be discriminatory and financially burdensome to the lower-income, would be nearly impossible to apply to outdoor products alone and be a “logistical nightmare” for most outdoor companies and small businesses to apply.

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