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Archive for December 16th, 2011

‘President Barack Obama hit China automobile tire makers with a trade tariff in 2009 and now Beijing has struck back with a potentially more punitive tariff, as much as a 21% tax hike on U.S. car exports bound for China, the world’s largest auto market.

This week, the Chinese government upped the ante in the Obama-China trade dispute by surprisingly imposing new tariffs on imports of Honda and Cadillac models, Chrysler Jeep Grand Cherokee, the BMW X5 and X3 and Mercedes Benz models made in Michigan, Alabama and South Carolina. China argues that the U.S. provided illegal subsidies to these companies during the economic downturn in 2008 and is selling those vehicles cheaper in China than they are sold for in the U.S.
The U.S. exports around $92 billion worth of goods to China and cars account for around $4 billion of that. The tariffs, which range from just 2% to as much as 21.5% could impact $2.5 billion worth of American auto exports, according to preliminary estimates by the U.S-China Business Council, a Washington lobby’.

Times have changed and in the spirit of free enterprise the US might require every dollar it can get. China has plenty to give or take and the US knows it. This sort of flexing muscles is not new.Here is a news item from The Telegraph of 6 March 2002:
‘PRESIDENT BUSH risked provoking a trade war with Europe last night when he imposed tariffs of up to 30 per cent on steel imports despite a last-minute appeal by Tony Blair not to damage British interests.
Digby Jones, the CBI director general, warned that imposing tariffs in the US would put British jobs at risk and could lead to foreign steel firms selling products to countries other than America, including the UK.
“The US should be setting an example to the world about what free trade really means,” he said. “It means global free trade, not American free trade.”
Now for the second news item from guardian.co.uk 4 Dec,2003
The US today stepped back from a trade war with the EU and Japan as George Bush lifted punitive tariffs on steel imports.
Mr Bush made his decision just days before a deadline that would have triggered retaliation from the EU, which was preparing to impose sanctions worth $2.2bn (£1.3bn) on US goods ranging from Florida citrus products to Harley Davidson motorbikes.
“These safeguard measures have now achieved their purpose, and as a result of changed economic circumstances, it is time to lift them,” Mr Bush said in a statement.
The measures were designed to inflict maximum political pain on Mr Bush, with the EU targeting products from states that would play a crucial role in next year’s presidential election. The World Trade Organisation last month ruled the US tariffs illegal and said the EU had the right to retaliate.
Reading these news should give the convoluted rationale that dictates power to nations to punish or reward one another. If Timbuctoo, don’t ask where it is located, has 7 billion population and products or commodities to trade it would be also in a position to call the shots. We are a global village now. Look at our history: the USA got its independence from Great Britain once a super power. Being a mercantile nation Britain wanted to impose fresh taxes on tea for its losses in Canada. It overplayed its hand and lost. It always dawn on a super power at a point of time that times have changed. Britain realized it and now it is time the US knew it.
The world is no longer to be divided as the private preserve of UK, the US or of China. So nations need to get its act together. It may be possible that nations would be a concept too old-fashioned to continue, instead we need to think of one Village and 7 billion inhabitants to keep every other afloat.
benny

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Sunbathing-rocks

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Long ago a traveler on arriving in El Dorado went to the king to pay his respects. The king was pleased and asked if he could help increase his revenues. He promised a share of it.
The stranger said he knew a way.
The king asked,’ How?’
The traveler said,” Taxes”.
The king liked the idea so much that he made him straightaway his finance minister. The man settled down in that land and amassed in course of time so much wealth.
The king died and a new king who came in found tax a convenient way to make money. The new king was very particular of doing everything strictly within the law. Thus he made it a law that all ministers who were till then exempted from paying taxes to pay up.
“ My ministers ought to set an example and serve the tax paying public.” The king insisted.
The ministers were given great many titles but their wealth were confiscated by way of tax, ‘Tax on titles’ it was called; The king had made a law of modernizing laws of the kingdom. It meant more taxes that left none.
Here we see the inversion principle.
* How keen are parents to see their infant walk for the first time! They take pride that their offspring can stand on its own and is normal like every other. That very moment also marks the beginning that child shall go its own way. It is only a matter of time.
Inversion Principle states that “ energy used by man in following a course of action will make its own motion,- that notwithstanding whatever success he may have had in making its impact on others, its backdraft will strike at the interests he represent.”
benny

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