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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?
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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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!
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.
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.
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.
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
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
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Carthago delenda est!
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
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!