The Democrats' protectionist trade bill passed the House with overwhelming support -- a circumstance owing much to the assumption that it was, as congressmen say, a free vote. Since President Reagan has promised to veto it, everyone could happily vote for it with assurance that it will not become law. The authors of the bill argue that the enormous majority on Thursday, 295 votes to 115, will enable them to override a veto. But before it comes to that, many things will have happened. The bill now goes to the Senate, where the enthusiasm for starting a trade war with Europe and Japan is more restrained.
A myth of great durability sustains all trade bills in Congress. The myth holds that the United States alone plays by the rules, while all the other countries -- the rats! -- take advantage of our good nature and cheat. They do terrible things, according to the indictment, such as harassing American exports, stealing American technology and dumping. Some of those accusations are, unfortunately, true. But it turns out that foreigners have some complaints of their own.
Let's take dumping as an example -- the practice of selling abroad at less than cost, to get rid of a surplus or perhaps to take over a market. In the world's trade tribunals, more dumping cases are filed against the United States than against any other country. That's not surprising. The United States is the world's biggest exporter. Sometimes dumping is inadvertent. Sometimes it happens because the rules count costs differently from the way businessmen do. The number of dumping cases doesn't mean that American exporters are immoral. But it does mean that the balance of equities in world trade isn't quite so clear as congressional speeches might lead an unwary listener to suppose.
The basic fault with the Democrats' trade bill is that most of it reflects only the grievances of the industries that are having trouble with their foreign competition. There's no consideration of the possibility that other countries would immediately apply these same provisions to American interests.
One example, among many: the bill contains a natural-resources provision, penalizing any imports into this country that use resources sold at less than market value. That's aimed at Mexico. Making cement and fertilizer requires a lot of natural gas. American cement and fertilizer companies have been complaining bitterly that Mexican competition is unfair because the government-controlled price of gas there is less than the government-controlled price of gas here. But if Congress passes the natural resources provision, a very long list of American industries immediately will be vulnerable to counterattack under the same rule. How about the farmers who depend on irrigation water that is grossly underpriced? How about all those manufacturers in the Pacific Northwest, with their access to that region's extremely cheap electric power?
House Speaker O'Neill denounces the administration for its insufficient concern for working people in the industries hurt by imports. But this bill will cost more jobs among the competitive export industries than it can save by protection. It's true that, until this year, the high exchange rate of the dollar did great damage to many American producers. But now the dollar has fallen, and by the end of the year American exports will be rising again. This is hardly the time to try to choke off trade.