New AAM study looks at effects of product dumping on manufacturing

'Enforcing the Rules' study available in book and video form

By Plant Engineering Staff May 22, 2007

A study released by the Alliance for American Manufacturing gives a first-of-its-kind look at the consequences of predatory trade practices on workers, manufacturers and their communities, and emphasizes the economic benefit of enforcing U.S. trade laws.

The study, “Enforcing the Rules,” provides an analysis of 10 recent cases in which anti-dumping or countervailing duties have been imposed to combat illegally dumped and subsidized imports in industries including shrimp, steel and furniture-making. The study has an accompanying video on the subject.

“When our trade laws are enforced, the contributions to the economy actually outweigh any of the so-called benefits of the dumped or subsidized imports by more than 50 times, in the form of American jobs, added productivity and a positive economic impact on the surrounding communities,” said Scott N. Paul, AAM’s executive director.

In the manufacturing sector alone, predatory trading practices have contributed to the loss of 3.2 million jobs and the closing of more than 40,000 facilities since 2000.

“Some critics have argued that AD/CVD laws impose duties that result in an increased price of the import, causing U.S. consumers to pay more. This new study shows that analysis to be incomplete and inaccurate,” Paul said. “The truth is that our trade laws are an effective tool for holding our trading partners accountable and combating illegal foreign trade practices that threaten the economic security of countless American workers and companies.”

“To get the true picture of the impact of dumping and subsidies, you have to look at the overall ripple effect on the economy, on the companies, on related industry sectors and on workers,” said Greg Mastel, one of the study’s authors. “The real damage also includes workers losing their jobs and plant closings, as well as the negative impact on the communities where those facilities are located.”

Measured by lost revenue, the impact the 10 specific sectors varied considerably. However, the overall analysis shows that the damaging effects of dumping and subsidies were curbed by applying the AD/CVD duties, which helped ensure that American producers were not undercut by goods that had been priced artificially low and dumped into the U.S. market.