- The Washington Times - Monday, July 22, 2002

Over the years, it would be hard to find a more stalwart free marketer in the Senate than Larry Craig, Idaho Republican. He has one of the highest National Taxpayers Union records in fighting against big government.
He has lead the charge on supply-side tax cutting. I have worked with him and his staff on the capital gains tax reduction that is so critical to getting the financial markets out of their 24-month slide.
So why in the world has Mr. Craig teamed up with ultra-liberal Democrat Mark Dayton of Minnesota to sponsor a poison-pill amendment to President Bush's free-trade bill? This amendment, as the Wall Street Journal recently noted, strikes at the very heart of fast-track trade negotiations. Under the Trade Promotion Authority bill, the president negotiates a trade agreement, and Congress agrees to vote up or down on the accord without amending it. Without this assurance, foreign leaders are unlikely to bargain trade agreements that could be eviscerated later by the protectionist twinges that always are present among the parochial interests on Capitol Hill.
The Dayton-Craig amendment would allow Congress to reject any provision of a trade bill that weakens so-called anti-dumping laws. Now this is a really lousy amendment on so many grounds, one hardly knows where to start attacking. It clearly violates the fast-track no-amendment policy. Once, one amendment to a trade treaty is allowed, the dam is broken. So Mr. Craig's rider would destroy the whole free-trade process that is rolling along here.
Unfortunately, Mr. Craig's amendment plays to the ingrained protectionist reservations about trade agreements among congressional members. With the strong support of the labor unions and the "fair trade" lobby, it actually passed in the Senate. The anti-free-trade and free-markets publication the American Prospect wrote approvingly of Mr. Craig's creation: "This is exactly the kind of mischief the Senate always keeps out of trade agreements, because it gums up the works in trade accords."
President Bush has said that he will veto the trade bill if the Dayton-Craig amendment isn't extracted. Good call, Mr. President.
This amendment is also bone-headed policy. There is no worse feature to our trade laws than anti-dumping penalties. Dumping laws forbid foreign companies from selling products here in the U.S. for below production costs. Why in the world should that be illegal?
If a Panamanian fruit-and-vegetable company is dumb enough to sell us bananas at a loss, or if the Koreans want to sell us steel for below cost, why would we outlaw the importation of these products. What if the foreign companies wanted to give us the bananas or the steel to us for free as a gift? Would we object to that as against our national interest?
Moreover, best-selling author Jim Bovard has shown over and over again that when nations "dump" products in the United States, the biggest winners are the American consumers who get low cost goods and services. He has also shown that any time an American company that is reporting losses in a given year as most did last year exports products abroad, those companies are technically guilty of illegal dumping. After all, since they lost money, they by definition were selling goods below cost.
Anti-dumping laws reflect an "exports good, imports bad" view of trade that is economically misguided and anti-consumer. The lower the price of imports, the higher Americans' real incomes rise, because we can all buy more products for the money we make in an hour's worth of work. This is precisely why a strong dollar is good for the United States. It makes us richer relative to workers in other nations. I call this Kudlow's law.
So shame on Larry Craig, and I say this with great reluctance because he is a personal friend. But if he wants to be a friend of the American worker and our high-tech, high-wage, free-trade-driven economy, he will repudiate his destructive amendment.
To paraphrase Woody Allen: Mr. Craig, you never want to be part of a club that would have Mark Dayton as a member.

Stephen Moore is president of the Club for Growth.

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