A Protectionist Administration?

ROBERT RENO

February 03, 1993|By ROBERT RENO

Does there beat beneath the breast of William Jefferson Clinton the heart of a raving protectionist?

The world was given good cause to ponder the question last week. President Clinton took the first major economic initiative of his new administration and what was it? A tariff -- ranging as high as 109 percent -- on flat rolled and plate steel from 19 of the nation's most intimate trading partners. This is a provocative act that amounts in many cases to a de facto embargo.

This week he followed up by barring European companies from bidding on government contracts.

Other clues to Mr. Clinton's true disposition on free trade are to be found in his reservations about the North American Free Trade Agreement, which is producing increasingly shrill resistance from Mexican officials. Meanwhile, many free-traders hold the view that the chairman of Clinton's Council of Economic Advisers is some sort of neo-protectionist who expounds exotic industrial policies.

Additionally, the president is reported to be not unfriendly to the pleas of the U.S. automobile manufacturers for a broad new tariff on imported cars as the logical extension of the Bush administration's cute experiments with minivan protectionism. Already there are signs that Japanese auto exporters are raising prices and curbing shipments to head off pressure for such tariffs. This simply means that the U.S. consumer will get it in the neck whether or not the tariffs actually materialize.

So, adding two and two and getting anything they want, the free-traders can make a fairly convincing case for the notion that the new administration represents a radical change from the liberal trade policies and rhetoric of the Reagan and Bush administration.

Trouble is, Reagan-Bush free-trade posture was often one third policy and two thirds rhetoric. Whether it was ''voluntary'' quotas on Japanese cars, inflationary tariffs on Canadian lumber, ''retaliatory'' tariffs on French wine, prohibitive levies on cedar-shingle imports or protection for American motorcycles, Presidents Reagan and Bush could rarely resist the temptation of a little dalliance with protectionism. This was always on the grounds that they practiced only good protectionism -- which punishes the trade offenses of others and saves American jobs -- as opposed to bad protectionism, which distorts market forces and hurts American consumers.

Even the tariffs that Mr. Clinton imposed last week on steel were merely a next logical step in the Reagan and Bush policies on steel imports. Tonnage restrictions on foreign steel were introduced in the Reagan administration and the Bush administration allowed them to lapse only last year, arguing that tariffs would be a better method of restricting ''unfair'' steel imports.

This led more or less directly to the Clinton tariffs imposed last week in an act that was already in the bureaucratic pipeline at the Commerce Department when he took office.

We can only guess at whether a re-elected President Bush would have imposed the tariffs at the same levels, but the fact is that the case had been made and was ready to act on even as other components of the Clinton economic policy remain in the early drafting stages.

There is a good argument that protectionism is a prurient act best confronted and dealt with when it is practiced out on the front lawn where the neighbors can see and not, as Messrs. Bush and Reagan enjoyed it, behind the barn or in the bushes.

Robert Reno is a columnist for Newsday.

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