Limits to Free Trade

Limits to Free Trade

Non-Tariff Barriers in the European Union, Japan and United States

David Hanson

This book explores the growing list of non-tariff trade barriers raised by the US, EU and Japan and assesses the prospects for significant trade liberalization. The author examines the liability of global free trade through a review of the complaints that these three countries raised about each other over a five-year period. He concludes that free trade may be increasingly hampered as barriers are created more rapidly than can be resolved, and that the prospects for significantly strengthening safeguards are limited.

Chapter 3: Background to Trade Policy in the US

David Hanson

Subjects: business and management, international business, economics and finance, international economics


INTRODUCTION The purpose of this chapter is to provide some background on the ways in which trade-relevant decisions are made in the United States. We will be looking at the trade policy decision processes from three perspectives: cultural, constitutional and administrative. Following the themes that were sketched out in Chapter 1, we will be considering three major groups of participants: business, government and voters. This simple scheme will provide a common framework as we consider the decision-making process in the European Union in Chapter 5 and in Japan in Chapter 7. The following discussions will expand on three simple themes about the politics of trade in the United States. Business is important, government is mistrusted and regulations are viewed suspiciously. However, the cumulative impact of international competition on US industries and communities has led to a widespread mistrust of free trade. Finally, the president controls international trade negotiations but Congress controls anti-dumping laws, countervailing duties and other government responses to international trade pressures. The conflicts between the president and Congress have contributed to a certain incoherence in United States trade policies. 2. 2.1 THE CONTEXT OF GOVERNANCE IN THE UNITED STATES A Cultural Perspective As Tocqueville pointed out, Americans are a mobile people, often lacking firm identities of family and place. Business becomes very important; we are what we do (Tocqueville, 1835; Boorstin, 1965). Our foremothers could adopt new identities as they came to the country. It is common for people to change cities as they change jobs. The question...

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