By the end of this month President Reagan must decide how much -- if any -- import protection to give the American shoe industry. The shoemakers are a familiar hard-luck case. They are a labor-intensive business, paying wages that are low by American standards but four times as high as those in the countries from which most of the competition comes -- Taiwan, Brazil and South Korea. The American manufacturers have repeatedly missed swings in style and fashion. Now, on top of all their other troubles, like all American manufacturers they are beset by an overpriced dollar that makes the imports cheaper than ever. Four years ago the imports had slightly less than half of the American market. Currently they have three-quarters of it.
The Reagan administration has reportedly decided against the most expensive and harmful form of protection, the import quotas that the International Trade Commission recommended. Quotas are an invitation to raise prices. A dissenting commissioner, Susan W. Liebeler, calculated that those quotas on shoes would cost American consumers some $800 million a year, which works out to about $35,000 a year for each job saved -- a job with an annual wage, on average, of $14,000. That's not much of a bargain. The administration is apparently divided between people who support less drastic protection, in the form of higher tariffs, and those who would prefer to act only in cases of demonstrably unfair and illegal competition. But this case involves more than one small and shrinking industry. Both sides -- those who want much more protection and those who want none -- see it as a precedent for much larger industries. Sen. John C. Danforth, chairman of the Senate's trade subcommittee, argues that a little protection now will mean less later. The shoe industry has met the legal requirements for protection, Mr. Danforth says; if the administration uses its discretion to refuse, it risks congressional action to limit that discretion.
The choice here isn't between more jobs or fewer. It's between existing jobs, some of them paying very low wages, and future jobs. Despite the tidal wave of imports coming into this country, there are more people employed now than a year ago, or five years ago. But they are employed in different lines of work, and in different places.
A vote for protection is a vote for a kind of social stability, at a broad -- and usually unrecognized -- cost in economic growth, incomes and opportunity throughout the economy as a whole. A vote against protection supports economic growth, at a cost in specific jobs held by people who bitterly resent the imports. Economic growth is not a gentle or considerate process. But when a president intervenes to slow it down through trade protection, it's important to keep one thing clearly in mind: the effects are not limited to one small industry.