US Dumping Corn in Canada?

[Wilber]

The grocery store is not a third party that has no direct interest in producing or selling the commodity. If they choose to sell something at a loss, they accept the loss. No one bails them out. The egg producer still gets his money. The loss is the stores alone, they share it with no one. The grocery store does have the right because because they have that direct interest. A government does not have any interest other than manipulating the market to their chosen party's advantage. When people try to manipulate the stock market we put them in jail. Well not in Canada maybe but that is another issue.

[Jerry J. Fortin]

I can see the point about heritage. But really guys is it smarter depending on cheap imported products for all our needs? Yeah it makes short term economic sense, but I am not sure it is the wise thing to do. I guess the proof will be in the pudding next year when Geely starts selling cars in Canada. They will sell you a car for 10 grand that wil cost the big three 30 grand to build. So when everybody starts buying the cheap cars you will see literally hundreds and maybe thousands of companies fail in southern Ontario. Maybe then this arguement will have a different meaning to you folks.

[Charles Anthony]

So when everybody starts buying the cheap cars you will see literally hundreds and maybe thousands of companies fail in southern Ontario. Maybe then this arguement will have a different meaning to you folks.

My argument will not change.

I understand the predatory practice you describe. The larger company (even at a loss) undercuts the smaller company long enough to make the smaller company go out of business. The larger company is hoping to gain all of the market afterwards and recoup their losses now that they have more volume. That can happen in international trade too. My argument will still not change because:

1) it is a result of freedom

2) it is a result of consumer choice; consumers freely choosing to buy the cheaper priced product

3) the world economy is soooooooo big that a smaller company can only be ran out of business in predatory pricing when the small company is truly charging more (consumer is being screwed)

4) consumers should not be required to prop up any business unless they want it

I understand that afterwards the larger company will have market control to jack up prices even higher than before. It is still a result of freedom. No one company should have the power to go to the State (and the tax-payer) to support their business. (I know we see that all of the time. I say it is wrong everywhere else, too.) Why should farmers get special treatment?

But really guys is it smarter depending on cheap imported products for all our needs?

Why not? Most of what we consume are imports. Food would be our last concern if we stopped our imports.

Specifically, in international trade and this thread, the extra amount of money saved by consumers from buying cheap imported corn can go to something else. The same amount of money will buy two or more things instead of just corn. That is the savings. Consumers are better off.

In fact, I will take it one step further: it is not a savings, it is a return to the consumer what is unfairly extorted.

[Wilber]

A tariff equal to a subsidy, or no tariffs or subsidies at all results in something being sold at it's real value and there is no difference to the consumer. In the case of a tariff equaling a subsidy, it's a wash for the producers but one government wins and the other loses. One taxpayer wins, the other loses.

Charles, as you approve of a foreign government manipulating a market for its farmers benefit with subsidies that allow you to buy something for less than it is worth, you should have no objection to the Canadian government doing the same for Canadian farmers. After all by your logic, the more farmers that are subsidized the less you will have to pay for your food. Let's take it all the way. You go into the supermarket and get what you want but don't pay. The government then adds a percentage to everyones income tax to cover the cost. The problem with that is now you are treading on my freedoms. I have a certain amount of freedom when it comes to what I buy but almost none when it comes to paying taxes.

Are you a Communist or just in favour of subsidies as long as they come out of another persons pocket and don't victimize you? Just another sufferer of that Canadian disease of looking for someone else to pay your way

[Charles Anthony]

Can you read???

Charles, as you approve of a foreign government manipulating a market

I have not said that. Where do you read that??

I am not telling the American electorate to pressure their government to subsidize American farmers.

I am saying that SINCE they subsidies their export industry (in this case, farming) and because WE can not change THEIR policies, let Canadians buy their product at the price they want to sell to us. Period.

If I was an American tax-payer, I would say that the American farm subsidies should stop. But, I am not an American tax-payer.

Can you provide ONE quote (from this thread or any other) of mine that even hints that I support subsidies of any kind?

[Wilber]

Charles you are repeatedly telling us that our farmers should not be protected from a foreign subsidy because it infringes on your right to buy those products at the artificially low price it provides. One can only conclude that you approve of that subsidy and your right to take advantage of it takes precedence over those other Canadians who are its victims.

[August1991]

I understand the predatory practice you describe. The larger company (even at a loss) undercuts the smaller company long enough to make the smaller company go out of business. The larger company is hoping to gain all of the market afterwards and recoup their losses now that they have more volume. That can happen in international trade too.

This strategy won't work in a market and I'm aware of no instance where it has been successfully applied. In a nutshell, here's why: when the big firm with, say, 90% market share reduces his price below cost, then he loses $9 for every $1 the little firms lose. That's untenable in the long run and the little firms know it.

Charles you are repeatedly telling us that our farmers should not be protected from a foreign subsidy because it infringes on your right to buy those products at the artificially low price it provides. One can only conclude that you approve of that subsidy and your right to take advantage of it takes precedence over those other Canadians who are its victims.

Wilbur, that's correct. When you choose to buy your milk at one store, then necessarily another store has lost your business. If you want to characterize the other store as a "victim", then so be it. But I'll ask you: Do you think it would be wise to buy your milk in the store that sells it at a higher price, when a cheaper but otherwise identical alternative exists?

To put this further in perspective, a hundred years or so ago, someone made a "victim" of a horse trader by buying one of those new-fangled automobiles instead. In this case, the horse trader really was a victim.

But really guys is it smarter depending on cheap imported products for all our needs? Yeah it makes short term economic sense, but I am not sure it is the wise thing to do.

[sarcastic voice]No, it makes economic sense to do things the expensive, complicated way when there's an easier, faster alternative. Everyone knows that's how individuals and countries become rich.[/sarcastic voice]

I guess the proof will be in the pudding next year when Geely starts selling cars in Canada. They will sell you a car for 10 grand that wil cost the big three 30 grand to build. So when everybody starts buying the cheap cars you will see literally hundreds and maybe thousands of companies fail in southern Ontario. Maybe then this arguement will have a different meaning to you folks.

I've been waiting for this for several years but I didn't know the name of the company. Geely, you learn something new everyday.

[Jerry J. Fortin]

While you may having been waiting for this development, you haven't said what you think will happen. I submit that we will soon be playing a global game in which we will not be able to compete. In a very real sense what is at stake is our standard of living.

[Charles Anthony]

While you may having been waiting for this development, you haven't said what you think will happen.

We will have cheaper cars available.

If the Geely cars are better or just as good as American cars, people will likely buy them more than they will buy American cars.

The Geely car companies will make profits and the North American car companies will make less profits.

North-American auto workers will likely have to find work elsewhere much like the horse trader had to find work elsewhere when the automobile was invented.

In your example, people will make a savings of $20,000 and out of the goodness of their hearts, they will donate that money to the American auto-pact companies victims charity to thank the American car companies for a history of higher prices.

I submit that we will soon be playing a global game in which we will not be able to compete. In a very real sense what is at stake is our standard of living.

Our standard of living depends on foreign imports anyway.

Pick up ANYTHING within a 1 meter radius of your arm and you will likely see that it is made in a foreign country. Are you able to force every Canadian to give all of that up??

Why should the farmers get special treatment?

[Wilber]

Wilbur, that's correct. When you choose to buy your milk at one store, then necessarily another store has lost your business. If you want to characterize the other store as a "victim", then so be it. But I'll ask you: Do you think it would be wise to buy your milk in the store that sells it at a higher price, when a cheaper but otherwise identical alternative exists?

When are you guys going to learn the difference between a store and a government. I give up.

[August1991]

When are you guys going to learn the difference between a store and a government. I give up.

Well, I am free to choose which store I want to give my money to. I pay government taxes in a slightly different way.

But Wilber, your remark confuses me a little. If the American government decides to subsidize American corn producers (and Charles noted above how difficult it is to define a "subsidy"), that doesn't concern me or Canadians.

If the Chinese are willing to build a car and ship it to Canada and sell it for $9000, should we start an investigation to discover how this is possible?

[Wilber]

When are you guys going to learn the difference between a store and a government. I give up.

Well, I am free to choose which store I want to give my money to. I pay government taxes in a slightly different way.

But Wilber, your remark confuses me a little. If the American government decides to subsidize American corn producers (and Charles noted above how difficult it is to define a "subsidy"), that doesn't concern me or Canadians.

If the Chinese are willing to build a car and ship it to Canada and sell it for $9000, should we start an investigation to discover how this is possible?

I know it confuses you.

[Jerry J. Fortin]

The reason they can sell a car for about a third of what we do is because they are paying their workers about $3.00 an hour. Now having said that, when everybody wakes up and has had a cup of coffee I would like them to think about that for a minute.

So its cheaper to buy those imported products, and we stop buying our domestic products. That money disappears out of the country and goes into the pockets of the factory owners in China. No problem we say, the guy earned those dollars by making a product that I chose to purchase. So off we go and tell our friends about the great deal we got on a car. They all agree and go buy some cars too. Pretty soon, they have to quit making those domestic cars because nobody wants to spend that much money anymore. Of course there were about 100 different suppliers of parts to build those cars, so they stop making car parts too. Now with all of those thousands of unemployed people having a reduced income they don't buy as much stuff as they used to. Now the little shops in their local towns lose a lot of their income which was realized from catering to those citizens who lost their jobs. The little shops start to close, some move into the big cities but lots don't they just go out of business. Now all of the doctors and lawyers, and the accountants start moving out of the little towns too, because they needed those citizens to provide them with employment. On and on it goes, getting worse each step of the way.

These things are not merely possible, they are damned likely because of our short sighted economic policy.

[Charles Anthony]

The reason they can sell a car for about a third of what we do is

irrelevent.

[August1991]

So its cheaper to buy those imported products, and we stop buying our domestic products. That money disappears out of the country and goes into the pockets of the factory owners in China. No problem we say, the guy earned those dollars by making a product that I chose to purchase. So off we go and tell our friends about the great deal we got on a car. They all agree and go buy some cars too. Pretty soon, they have to quit making those domestic cars because nobody wants to spend that much money anymore....

You're right Jerry. Soon the Chinese will be making everything. Cars, car parts, hard drives, TVs, MP3 players... We'll just be doing the McJobs of retail and collecting garbage...

Except.

Surely the Chinese are not going to keep sending us cars and car parts for free. At some point, surely, the Chinese are going to want something in return. No?

[Jerry J. Fortin]

The reason they can sell a car for about a third of what we do is

irrelevent.

That would depend on your point of view! Charles do work for somebody or are you self employed?

[Jerry J. Fortin]

So its cheaper to buy those imported products, and we stop buying our domestic products. That money disappears out of the country and goes into the pockets of the factory owners in China. No problem we say, the guy earned those dollars by making a product that I chose to purchase. So off we go and tell our friends about the great deal we got on a car. They all agree and go buy some cars too. Pretty soon, they have to quit making those domestic cars because nobody wants to spend that much money anymore....

You're right Jerry. Soon the Chinese will be making everything. Cars, car parts, hard drives, TVs, MP3 players... We'll just be doing the McJobs of retail and collecting garbage...

Except.

Surely the Chinese are not going to keep sending us cars and car parts for free. At some point, surely, the Chinese are going to want something in return. No?

Well yeah that is true. It won't kill me here in Alberta, we will still be selling them oil and by then I will be retired and living on a pension anyway. But the folks in central Canada will see a hell of a lot of jobs disappear overnight.

[Charles Anthony]

The reason they can sell a car for about a third of what we do is

irrelevent.

That would depend on your point of view!

No it does not. That is why I pointed it out.

The point that you are missing is that you can not always know WHY (whether it is due to subsidies or cheaper labor costs or better technology or secret technology or better weather or lower taxes or whatever) for every single product that is imported or exported.

Retaliatory trade practices based on WHY an export is cheaper is an excercise in futility. Ultimately, it gets reduced to special treatment for certain sectors of the economy over other sectors at the direct expense of the consumer.

[Jerry J. Fortin]

So in all instances the current market price is the best economic practice regardless of any other consideration. Under this concept no regulation of industry is necessary, nor is there any need for trade agreements. Is that an inaccurate desription of your intent?

[August1991]

Uh oh.

Canada has launched a challenge at the World Trade Organization against what it sees as the trade-distorting subsidies the United States gives to its corn farmers, Ottawa said Monday.

"Canada is concerned that these U.S. subsidies continue to cause economic harm to our corn farmers," Agriculture Minister Chuck Strahl said in a statement.

Ottawa says that in the last two years Washington's corn subsidies averaged almost $9 billion U.S. annually, causing "a significant distortion" of prices in Canada.

...

Canadian Corn producers launched a trade complaint in 2005 against imports of U.S. corn used for livestock feed and ethanol production, which they said were dumped on the market.

Canada slapped temporary duties of $1.65 per bushel on the imports in December 2005, but ended them in May of last year after an investigation found the imports did not hurt the domestic corn industry.

Toronto Star

I hope Strahl only intends to take this to the WTO and has no intention of imposing duties.

[Charles Anthony]

-- and I hope that the United States tax-payers continue to subsidize their corn farmers.

When corn is dumped in Canada, it means the U.S. tax-payer is paying for our cheap imports. Unfortunately, Canadian corn-sellers will no longer be able to charge us as much. Too bad. My sympathies go out to them but my money should not.

[margrace]

-- and I hope that the United States tax-payers continue to subsidize their corn farmers.

When corn is dumped in Canada, it means the U.S. tax-payer is paying for our cheap imports. Unfortunately, Canadian corn-sellers will no longer be able to charge us as much. Too bad. My sympathies go out to them but my money should not.

I am wondering how many of these authorities on farming on here have ever lived or worked on a farm. Most of what they say is heresay.

[Charles Anthony]

Indeed, I am no authority on farming and most of what I know is based on hearsay. My public policy advocacy generally makes me a heretic too.

Pardon me J.J. for not replying.

So in all instances the current market price is the best economic practice regardless of any other consideration. Under this concept no regulation of industry is necessary, nor is there any need for trade agreements. Is that an inaccurate desription of your intent?

In general, yes, that describes my intent.

[August1991]

I am wondering how many of these authorities on farming on here have ever lived or worked on a farm. Most of what they say is heresay.

I have no patience for that kind of argument.

Do you have to have cancer to become a cancer researcher? Can only cancer patients understand what cancer is?

When this idea is taken into the political arena, the result is even more horrendous. Should only farmers decide government farm policies?

[blueblood]

I am wondering how many of these authorities on farming on here have ever lived or worked on a farm. Most of what they say is heresay.

I have no patience for that kind of argument.

Do you have to have cancer to become a cancer researcher? Can only cancer patients understand what cancer is?

When this idea is taken into the political arena, the result is even more horrendous. Should only farmers decide government farm policies?

Should only people from outside the farming industries decide government farm policies?