BPEA | 1987 No. 1

Protection and Retaliation: Changing the ‘Rules of the Game’

1987, No. 1

EVEN A QUICK PERUSAL of the daily paper suggests the controversial nature of international trade in the United States today. Canada and the United States are skirmishing over stumpage fees for lumber and support prices for corn. The European Community and the United States, having recently reached a truce in their grains and luxury edibles disagreement, are now arguing about airplanes and oilseeds. The United States and Japan are circling in round two of their semiconductor match. Germany and Switzerland refuse to restrain voluntarily their exports of machine tools to the United States. U.S. soybean producers demand a countervailing duty on Argentine soybean products because, they charge, Argentina’s differential export tax encourages soybean production. Do these trade problems have a common foundation? Do the specific disputes threaten to escalate into broader-based conflicts involving more products or more countries? Can the historical record shed light on the causes and consequences of such trade arguments?