WTO Rules Against Canada over Softwood Lumber

[August1991]

August, I have repeatedly argued that this statement is mostly false since the duties did not increase the lumber prices enough to replace the cost of the duties.

In this case, I would be surprised if the duty accounted for all of the increases in US softwood prices. But softwood lumber prices in the US had to increase or what was the point of the duty?

Any increase in the US price means some of the $5 billion tax is paid by US consumers. I recall seeing studies suggesting that indeed well over half of the burden of the tax fell on them but I see that you state that is was 70%.

The large portion of the duties was paid by Canadian industry for exactly the same reasons that you use to argue against an export tax on oil.

From Canada's standpoint, crude oil and softwood lumber in North America are two very different markets. Canada could successfully apply an export tariff on softwood lumber but we couldn't on crude oil. (I think the US government wants to negotiate a softwood export tariff.)

In Canada, the logging companies build the roads - that is a huge expense. In addition, environmental regulations make it more expensive to harvest timber in Canada which is also a cost that must be factored into the equation.

Again, this is an issue for (mostly) BC taxpayers to think about. Should taxpayer money be going to such an industry? Is it a charity? As to environmental regulations, I understand that they are more severe in the US than in Canada. But that too is a separate question.

The Americans have repeatedly tried to make a case that the stumpage system represent a subsidy, however, they have failed.

And I have repeatedly argued that the stumpage system, the whole subsidy issue, should be of concern to BC taxpayers. It is ironic that the US government is concerned about something that doesn't matter to them, and then the people who should care don't seem to.

You can argue that the gov't should not engage in such social engineering activities, however, in theses cases, the lower stumpage benefits the people of BC directly and not the logging companies.

You trust logging campanies?

[Montgomery Burns]

I'm not sure who is right on this one. But since the WTO is an agency of the thoroughly corrupt and inept UN, I have to side with the NAFTA ruling on this.

[err]

I'm not sure who is right on this one.  But since the WTO is an agency of the thoroughly corrupt and inept UN, I have to side with the NAFTA ruling on this.

<{POST_SNAPBACK}>

To answer "August" style: YAFM

[Toro]

I'm not sure who is right on this one.  But since the WTO is an agency of the thoroughly corrupt and inept UN, I have to side with the NAFTA ruling on this.

The WTO is a UN institution? Are you sure about that? I don't think that's the case. The WTO is an outgrowth of the GATT, which was signed a few years after WWII.

http://www.wto.org/english/thewto_e/whatis..._e/inbr02_e.htm