To explain what a Section 421 trade case is, here's the policy background:

In 2000, Section 421 of the Trade Act of 1974 was in incorporated into the US-China Relations Act. This action gave China permanent normal trade relations and was instrumental in their becoming part of the WTO. What Section 421 spells out is protection for US workers and manufactures from sudden increases in Chinese imports which would disrupt our domestic market. Under this law, the US International Trade Commission, which consists of six members, decides whether or not a Chinese import is disruptive to or has the potential of disrupting the US market. To start this process, a petition is filed with the USITC, then they conduct an investigation, hold public hearings and, finally, vote on the matter. They send their recommendation to the President of the United States who imposes corrective measures.

USW initially suggested quotas limiting the number of tires imported from China, but the final recommendation from the USITC to the President was for tariffs to be imposed on Chinese tire imports. Back in June of 2008, then Sen. Barack Obama noted the importance of enforcing existing trade laws to protect US workers:

“As President, I will take a vigorous, pragmatic approach to addressing [trade issues with China], utilizing our domestic trade remedy laws as well as the WTO's dispute settlement mechanism wherever appropriate.”

In keeping with his pledge, on September 11, 2009 President Obama imposed tariffs on Chinese tire imports for a period of three years: 35% for the first year, 30% for the second and 25% for the third. The Administration is satisfied that this will achieve the same goals the USW sought in their petition.

“This is an important day for all American workers – especially the thousands of tire industry workers whose jobs were on the line as a result of a huge surge in Chinese tire imports that began in 2004. This decision means a better deal for hardworking American men and women and the millions of manufacturers, farmers and ranchers, and service providers who ask only for a chance to compete on fair terms. It also means China and other countries can no longer assume they can engage in predatory trade practices with impunity. The President understands that providing effective relief from import surges for the U.S. tire industry in this case is fully consistent with our WTO obligations. And it is the right thing to do,” USW International President Lee Gerard said.

It wasn't just the USW leadership that made this happen. It was a well-organized, grassroots effort by the men and women of the USW all over the country who wrote and phoned their elected officials demanding that trade laws be enforced. Thanks to the USW Rapid Response team of activists, over 80,000 letters were sent to the White House during a four week period. Not everyone involved came from a plant that was directly impacted by these imports, but it was a powerful showing of solidarity. The members of USW Local 307 who work at the Goodyear plant in Topeka were part of this effort. Primarily, the Topeka plant produces large, off-the-road (earthmover) tires. However, some larger light truck tires are manufactured in Topeka, so our Kansas economy may directly benefit from this action.

Here's my podcast of this blog:

Subscribe Free
Add to my Page