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U.S. Imposes Big Tariffs On Korean Chipmakers
dipfan writes "This is serious - the U.S. government has decided to levy steep import tariffs on South Korean computer chips (and Vietnamese catfish). The result is a 44 percent tariff on DRAM semiconductors made by Hynix. The case was brought by Micron Technology on the grounds that the South Koreans were receiving unfair subsidies. Hynix says the tariff is 'outrageous', and the South Koreans plan to appeal to the World Trade Organisation."
Micron's lobbying wouldn't have anything to do with Micron posting a loss last quarter, would it? Nah. Of course not.
Bush should be trying to stimulate the tech economy. Instead, he's killing the US$ to historic lows, and now this? Pretty weak!
Demand free trade to 3rd world countries, close the internal market. Nothing to see here.
If the U.S. is going to get itself involved in the WTO, it should learn to play by it's own rules. Free trade? Or free trade only when it's good for us?
Because focusing on SK makes money in this respect. Focusing on North Korea tends to cost money (and potentially lives).
Sombody took a cue from the dorks trying to destroy the Canadian lumber industry, I see.
Korea, welcome to the club.
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"nosce te ipsum"
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Just another example of the hypocritical U.S Government. They constantly scream they are all for free trade yet when things arn't going their way, they the scales in their favour. Hopefully this won't spark a trade war........
This gives Micron carte blanche to raise their prices by 44%, which while it may save a few jobs in Idaho, will ultimately cost even more jobs at US companies that buy memory (think the likes of Dell and so forth).
Tariffs BAD! Free trade GOOD!
These are the wonders that show how god damn corrupt we really are. Anyone with the slightest understanding of economics understands the problem: yeah, all you people loose ... but Micron gains, so they lobby. It's a shame that in 2003 we still fight wars and impose tariffs. No hope left...
US government imposes tariffs due to foreign subsidised business selling into the US market.
Pot calls kettle black.
The US government is the worst offender on Earth with subsidising industries to kill foreign competition.
Is the free market being peddled by the US so hard to implement on their own shores? Do they hate others using their own tactics against them?
I don't suppose too much of the US computer industry will be happy about this, seeing as it is bound to drive up prices when the sector is on the edge...
Exactly the same thing happened with Canadian softwood lumber even though we have a supposed free trade agreement. It'll go to the WTO, the S. Koreans will win but that'll take years. In that time, their industry is crippled.
Welcome to the invisible corruption. The consumer now supports micron to be inefficient, and looses out big time. If Korea was subsidizing their DRAM makers, we should be happy: That would mean their tax payers are paying for us to have cheap memory. However, since Micron gains with the tariffs, the gains are concentrated to one company and they lobby (probably pay) government officials for the tariffs. Such a shame, because it happens much more than we know about; this is on slashdot because it is about DRAM. If only everyone could see ...
So then you don't have problems with flooding the market with undervalued products to eliminate competitors.
Microsoft will be glad to know the Open Source community has come around to its way of thinking.
Thanks.
-- You see, there would be these conclusions that you could jump to
Micron is NOT inefficient, in fact they are one of the more healthy memory makers, it's just that they can't compete with a government propped business that dumps chips below production costs. The EU is not very happy about Hynix either so it's not just the American's protecting a weak company.
There are 4 boxes to use in the defense of liberty: soap, ballot, jury, ammo. Use in that order. Starting now.
Why is everyone siding with the subsidized competition? If the Korean government is giving money to Hynix, then they are clearly not playing by the rules of free trade--so why should Micron? Until the Koreans get in line and stop giving taxpayer dollars to their own corporations so they can dump products here*, there is no reason for the US to let them get away with it. The US is only counteracting Korea's unfair practices until it stops this action. I applaud this move. It will force the Korean government to get in line with the global free market, at which point, the tariff will be dropped, and the market will be free to correct itself.
* just like Japan did with automakers back in the 1980s, look what happened when they finally gave in to free trade--their market had to correct itself
Hynix announces high volume trade agreement with major EU computer retail chains. Maybe. If the US doesn't want cheap good stuff, other countries will be happy to take it.
This sort of carry-on is why many countries no longer give a toss about "free trade" agreements with the US - they're not worth the paper they're written on if the gubment feels so inclined.
Forget thrust, drag, lift and weight. Airplanes fly because of money.
I am just wondering why all pro-free trade comments are being modded up and all pro-tarriff comments are being modded down? Doesn't sound very balanced to me, there are benefits on both sides, but the modderation of it is not promoting debate, it is promoting winning on one side through censorship, even if they are readable comments still, they are hidden to most.
Would you like a job with that RAM chip?
That's the problem here, South Korea got caught giving a subsidy to a failing company which enabled it to continue to operate at a loss when it rightfully should have gone out of business. As a result, Micron got less sales, and that means Micron ends up hiring less Americans. The only fair thing to do is for the USA give Micron a subsidy at the cheater's expense...
The only way for a company in the US to compete with a 3rd world one and still give high paying jobs to it's employee's is through tarrifs, so we get both high paying jobs and a little more cost in products, it's how it is and how it always will be, it keeps us out of poverty by making us have to pay a certain amount of money so we will buy internally. It is good for our country, bad for smaller ones, but I think smaller countries need to rely on themself and not sales from the USA. The low foriegn prices are not worth the loss of local jobs. Every country needs to be a little independant.
Yes, Corporate Welfare is wrong. And that's exactly what the South Korean government is doing. If you had bothered to read the first paragraph of the article you would know that the reason the Commerce Department is levying this tariff because it believes the Korean government is illegally subsidizing chip exports.
This tariff is just leveling the playing field, but "U.S. imposes chip tariff in response to Korean subsidy" doesn't draw nearly as many eyeballs to the advertisements below the article.
I think it's great that the U.S. finally gave Hynix the boot. The S. Korean government has been keeping them alive and competing with our companies, even though Hynix has failed to produce a profit and would basically go in the red if it weren't for all the government money keeping it alive.
Companies like that deserve to die - if you're not producing a profit, and you're causing U.S. companies to lose money, why should the U.S. continue to allow you to do business with us? It's our semiconductor industry vs. the entire south korean government - that's bad for the people who work at micron and other semiconductor companies. Think about the people trying to make a living here, for pete's sake.
It's hard enough dealing with domestic competitors, let alone an entire foreign government. 100% tariff would do just fine too.
This tariff is a tax on the American consumer. The federal government has just raised the cost of a product by 44%. There is no rational economic justification for this tax. If the South Korean government wants to spend money to subsidize a company that is the problem of the South Korean tax payer, not the U.S. federal government. The government is interfering in the market in order to subsidize a politically well connected company. They are no better than the South Korean government. The best the U.S. federal government can do, would be to remove its military from South Korea and force the South Korean government to bear the expense of maintaining a military to defend itself from North Korea. In that scenario the South Korean government would have to decide if they should be spending their money subsidizing companies or training an adequate military.
Stuart Eichert
Steel tarriffs. US steel manufacturers weren't competitive, and it was much cheaper to import steel from elsewhere (eg, Russia) than to buy it from US makers.
The Dubya solution to this problem? Slap heavy tarriffs on imported steel.
So much for fair trade, a free market and a unhindered economy.
It's not like that's the only example either. US lumber mills are less productive and more expensive than their Canadian counterparts, who've spent considerable millions becoming more efficient and cost effective.
The reward for this Canadian efficiency? Tarriffs on soft-wood lumber.
So much for NAFTA.
Opinion on Dubya is heavily polarised (you either love him or hate him and I'm not going to get into that debate here) but even his staunchest supporters would have a hard time arguing that he's an advocate of free trade.
"Accept that some days you are the pigeon, and some days you are the statue." - David Brent, Wernham Hogg
to +1 funny!
"Not mentioning the number of fantastic things that Bush has done"
name 3
"The man brought much needed integrity back to the presidential position"
um the alcoholic, cocain sniffing, daddy get me a cush position so I don't have to go to war, lying war monger has brought back integrity? please.
"He is a strong leader in the time of terrorism,
of all the people who have been in office when this country was in a time of crisis, he has been the worse.
"Give the guy a break."
he is president of the United States of America, he can have a break when he is no longer in office.
Nobody gave Clinton a break and all he did was get a blow job. was that wrong? I would say so, but is it as bad as the corporate dealing Bush has done?
No.
The Kruger Dunning explains most post on
But, as I've said, it's no news. Recently, U.S. Gov. has put huge barriers against steel from others, more competitive countries (Brazil, E.U., etc.).
U.S. preaches capitalism to the world, and, by the way, I have nothing against that. But, when others show themselves better than U.S. in some tiny economic niche, all the courageous, competitive dogma goes away and "protective tarrifs" come in place.
Wasn't big american companies also subsidized? Airlines, Aerospace companies, etc...? What is so different with South Koreans?
So why, exactly, does the US like to beat the free trade drum?
Because it's no tariffs on the products they export, but they can put tariffs on anything they decide deserves it.
That isn't free trade.
Personally, I don't want free trade. Most people don't want free trade. But if you are going to ram it down our throats you may as well actually let the populace see the full effect of it.
What's good for the steel manufacturers (high tarriffs on foreign steel imports) isn't good for steel consumers.
Why should construction companies, etc have to pay an artificially inflated price for a vital commodity? Why should a shipyard on either coast have to support a steel mill in the Midwest?
What you forget is that by making the US steel manufacturers more competitive, you're making US steel consumers less competitive. Overnight, these steel tarriffs have made it harder for US shipbuilders to compete in the global market. The same is true of other industries too.
So, in essence, Dubya is robbing Peter to pay Paul in the hope that he can secure Paul's vote in the future and that Peter won't notice.
Yay for free trade!
"Accept that some days you are the pigeon, and some days you are the statue." - David Brent, Wernham Hogg
Integrity? By lying to go to war?
Besides, your post does nothing to show Bush isn't a hypocrate when it comes to free trade which is what the above poster was pointing out.
autopr0n is like, down and stuff.
if you're not producing a profit, and you're causing U.S. companies to lose money, why should the U.S. continue to allow you to do business with us?
Hmmm. Let's outlaw the U.S. Post Office then. Seriously, does this bit of extremism apply to U.S. companies that aren't turning a profit, and competing with other U.S. companies? Or just foreign companies?
For that matter, what makes a U.S. company a U.S. company? Most of the big corps are technically out of The Bahamas or similar countries who've found a nice little niche by shielding companies from the tax men of the countries in which they do business.
I'm no economist, but I think it's pretty obvious that whatever governmental assistance Seoul provides Hynix is pretty much being met tit-for-tat, and then some, with this tarriff. Not surprising that Washington would choose this tactic, though, since they've already imposed tarriffs on Canadian lumber and European steel. While these tarriffs certainly protect American jobs, a cynical view is that the imposition of these tarriffs is not so much about protecting our economy, it's more about protecting electoral votes in Pennsylvania. Though that argument doesn't make a lot of sense when applied to Washington timber. It does make sense in Micron's home state(s) of Idaho (and Virgina, after acquisition of Toshiba's facilities there).
Political cynicism aside, one thing I did learn (Bueller? Bueller?) is that the Hawley-Smoot Tarriff Act was the proverbial straw that broke the camel's back and led to the Great Depression. Is saving the White House worth a repeat of that?
Finally, you end with the statement "It's hard enough dealing with domestic competitors..." Which domestic competitors are you talking about? Who else makes DRAM in the USA? I was under the impression that Micron was it.
To sum up: I guess we should go ahead and slap a huge tarriff on Airbus as well! Because surely the American consumer will benefit when Boeing, protected by exorbitant tarriffs, can charge the airlines whatever they please for a new 737.
How is a company supposed to "compete" with South Korean government subsidies? The Korean taxpayers are subsidizing the low cost of Hynix products. Why *shouldn't* the U.S., and E.U., apply a tarriff to Hynix products? Should the U.S. and the E.U. allow countries like S.K. and companies like Hynix destroy their native industries? No. Should they subsidize their native industries in return? No. Should they apply a tarriff that negates the effects of the South Korean subsidies? Yes!
Napster-to-go says "Fill and refill your compatible MP3 player", which is a lie. It's not MP3. It's WMA with DRM.
Man. Are you lost.
The US is one of the world's largest manufacturers and exporters. Why do you think most large US companies have sales offices all over the world. Think IBM, Microsoft, Oracle. Equipment manufacturers like Caterpillar. Telecom like ATT. All these firms bring in a large amount of money from foreign countries.
Get this straight. The problem is not that small countries rely on the US for handouts. The problem is unfair trade policies that actualy hinder these countries ability to compete.
Policies like demanding they open their markets while protecting yours.
Based on upvotes, Ageism is the only "-ism" Slashdotters care about and think isn't SJW
Homer: Lisa, a guy who's got lots of ivory is less likely to hurt Stampy than a guy whose ivory supplies are low.
-- Simpsons [1F15] "Bart Gets an Elephant"
Carthago delenda est!
Interesting, once "national" interests come into play then free trade goes out the window...
Is that how I should view things? Because if that is what you are saying it is extremely two faced! Other countries are saying the same thing btw. However to the American politicians they are viewed as "isolationist", etc..
You know that is what trade is about. Specializing in specific tasks that the other one cannot do as efficiently. But I suppose it only applies until "national interests" come into play...
This is the problem of the current administration. They are two faced and see things using only one perspective. It is going to get them burned...
"You can't make a race horse of a pig"
"No," said Samuel, "but you can make very fast pig"
Sorry did you say *little* more cost? Try $50 Billion/year for us and $150 Billion a year for the third world. link. Steel tariffs alone are essentially paying US steel workers each something like $80,000 in inefficient prices. Yet they don't really make that much, even though we pay it. Poverty is not a measure of how much you make, but of how much you can buy. Tariffs *invariably* make consumers poorer.
Boom Shanka
That's exactly what the US said about softwood lumber. Despite the fact they've said it three times before and have been proven wrong each time,and despite preliminary rulings coming down suggesting they'll be proven wrong yet again.
It's also exactly what the US said with respect to Canada's grain industry, despite the nine previous times they've said so, and being proven wrong each and every time.
So you'll excuse me if I don't believe the US BS.
That Jesus Christ guy is getting some terrible lag... it took him 3 days to respawn! -NJ CoolBreeze
If the South Koreans think no competitor will rise up after they stop dumping, then they're delusional. If on the other hand, the South Koreans believe they can subsidize my US lifestyle forever, then I wish them all the best.
Long live South Korea !
Sincerely,
Selfish And Proud of It
And, one more question... how did Sadam get that nerve gas in the first place?
A) after a bad fart, he had an ingenious idea
B) stole it from someone
C) those freedom hating French gave it to him
D) his pal George Sr. was quite happy to sell it to him, and probably his taliban friends too
enter sig here
One only need look to a current news article to see why:
1 .html)
= cnet).
Micron Sees Improved PC Demand, Even Though Dell Doesn't(http://biz.yahoo.com/tsp/030611/10093006_
Hmmm...which of the two companies mentioned has a better track record at the PC industry? Does Micron even make PCs anymore?
This Hynix dumping thing is really just a lame attempt to cover up some very stupid decisions on part of Micron.
When the Hynix acquisition didn't pan out, what did Micron do? Go and buy Toshiba's DRAM operation instead.
All this in 2001, during a time of falling prices (http://news.com.com/2100-1001-271208.html?legacy
Now they're saddled with overcapacity and lost something like $900million on sales of almost $2billion. Nobody to blame but themselves.
Why isn't the US government doing anything about all the cheap labour being dumped onto the market by the mid/far east?
Isn't that far more damaging to the economy?
Think about it. He said for years that there were no more WMD in Iraq. He also had 4 years to put them anywhere he wanted to. Anyway, since he did not use them in the war, even though he was backed into a corner, everyone's automatically going to think he didn't have them available.
He's counting on wearing down America like Vietnam. He's put a bounty of $350-$1500 for each American soldier killed by a loyalist. So just about everyday since the "official" end of hostilities, at least 1 American soldier has been killed by sniper, RPG, or ambush.
When the Americans leave, he can come back in from Syria or Jordan and set up shop again. He's counting on Americans to get tired of soldiers getting picked off, one at a time, every day. He's playing off the media, the EU, and skeptics of Bush to get his power back. Saddam is not an idiot. He's survived a lot longer than he should have, and there's good reasons for that.
Prof. David D. Friedman explains at some length in Chapter 19: The Political Marketplace of his book Price Theory: An Intermediate Text the harm that is done by tariffs. The problem is that the benefit is very concentrated, while the cost is spread throughout the rest of the economy. In this case, it is even tougher because Micron is making the argument that their request is in response to subsidies favoring their competitor. I'm sure that most Slashdot readers can follow Friedman's math if they have the patience for it. But for those who can't or don't, he makes his argument in words as well as equations.
While this tariff would benefit Micron, it would cost lots of other companies money. What I would prefer to see is for the US to push the threat of a tariff. Let South Korea take their case to the WTO. Send in a team of vicious attack lawyers who will readily agree that both the tariff and the South Korean subsidy are wrong. Let's see Micron and Hynix compete head-to-head without tariffs or subsidies.
Their subsidy is at least as harmful to their economy as a tariff would be to ours. Simply put, we have the option of avoiding the tariff by not buying the goods. The citizens of South Korea pay for the subsidy regardless of their own individual choices, and at least in the short run, regardless of whether the chips even get sold.
The net will not be what we demand, but what we make it. Build it well.
You're argument might hold up if we were comparing finding 15,000 gallons of Anthrax with finding 15,000 gallons of Saddam.
Actually, I wouldn't be suprised if wherever Saddam is hiding right now occupies at least 15,000 gallons worth of physical space. So his argument is pretty valid. I honestly believe that Iraq did have WMD. Why? We helped Saddam get them. You know, back in the days when he got they key to Detroit(I think).
Regardless of your stance on the war, it's silly to pretend that Iraq never had any WMD. They've used chemical weapons before, that's an undisputable fact.
I don't agree with the way the Bush administartion has handled things, but I don't really care if we find WMD. Do we really have to find a nuke for people to concede that he was actively trying to build them? Only then should we act, once he has nuclear capability? Or should we wait until he actually uses one? Or should we wait until he takes over a few neigboring countries?
Saddam being in power was bad. Do we really need to find WMD to prove that?
Life is too short to proofread.
Bush being in power is bad. So sayeth most of the world.
Do we really have to wait until he sets of an a bomb or starts WW3 before we act?
But ok, in your argument if it does not matter, about the WMDs, and the only thing that matters ist that darn it, he is soo evil.
Then Bush has a list of mile long of everybody he has to go invade and depose, in countries all across the world. but of course he wont do that...
Several of those countries do not have oil, and an existing infrastructure that can be sold of the low bidding american companies, and large ammounts of money that can be siezed and distributed to americans who sued before a certain time, (before the Iraqi ppl who have suffered far more, and far longer get anything)
Furthermore where was your activism, where was your concern, where was your humanity back in 1988 or so, when he did kill all those kurds.
Where was your humanity, and activism when Saddam, guided by Bush the first, and his generals, killed the uprising in the south of Iraq, and then killed the Kurd uprising in the North.
The US deliberatly refused the generals who were rising against Saddam access to captured Iraq military equipment, they refused to stop the Saddam loyal gunships that flew over them and massacered them by the thousands.
But now, in 2003, your REALLY concerned about how he treats his people, your REALLY concerned about how evil he is.
Please give it a rest.
On the other hand, every poor country that has become developed (mainly the "Asian Tigers") have done so to a large extent through the use of trade to leverage their economies.
So while these countries certainly engaged in government-lead industrial policy, without being able to trade with other countries (especially the US), they would still be poor today.
Moreover, it is looking like once countries achieve a certain level of development, government-lead industrial policy begins to fail them. Korea and Japan came a long way, but are now stagnating and trying to reform into more fully free-market economies, but the siren song of protectionism keeps them from moving forward.
Meanwhile, I can assure you there is no benefit to the US limiting trade with anyone. If they want to sell us cheap DRAM, damn, let's buy it up!