Congressional stupidity on trade

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The worst trade policy suggestion I have heard in a very long time:

Any company that wants to import goods into the United States would have to get a government certificate, under a plan to eliminate the nation’s trade deficit proposed by two Democratic senators Thursday, The New York Times reported Friday.

“We’re choking on trade debt and it is becoming a bigger and bigger danger to our country by the day,” Senator Byron L. Dorgan of North Dakota was quoted as saying. “We need a new strategy, and that is what we are proposing today.”…

Dorgan and Senator Russell D. Feingold of Wisconsin said the bill would create a market-based system to cut the trade deficit to zero within 10 years.

Under the measure, companies that export goods from the United States would be issued a certificate to import goods. The exporter could use the certificate or sell it to another company, the senators said.

The plan would be phased in over five years, with one dollar in exports earning 1.40 dollars in import certificates the first year, 1.30 dollars the second year, 1.20 dollars the third year and so on.

Wow. Wow. That’s all I can say. I’m floored.

[Hat tip to Sallie James.]

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One Response to “Congressional stupidity on trade”

  1. reasonable Says:

    I have to agree. I’m a die-hard Democrat but this just made me cringe and want to cry. Who on earth is advising these guys on economic matters? Whoever they are PLEASE fire them at once.

    This is in effect a system of global import licenses. It’s basically a system of quotas. The legislation says they would set the price the license $1 for $1 after a few years, but that’s silly, the licenses would be priced on the market to reflect their scarcity value. The license price would soar in effect creating a prohibitive tariff. Aside from being a flagrant violation of WTO rules, it’s just plain dumb stupid economics.

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