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Recognizing The Folly Of Newspaper Tariffs

September 3, 2018

The International Trade Commission struck a blow for the newspaper industry and free markets Wednesday when it ruled against tariffs that the Trump administration had placed on Canadian paper. Based on a complaint from a single struggling paper manufacturer in the Pacific Northwest, which claimed that it was the victim of Canadian producers “dumping” paper in the U.S. below their production costs, the administration placed tariffs as high as 20 percent on paper produced by Canadian manufacturers. The resulting price increases placed a heavy burden on U.S. newspapers and other publishing businesses. To reduce or offset paper costs, many papers reduced story and page counts or entire sections, or laid off staff. The ITC said it had “determined that a U.S. industry is not materially injured or threatened with material injury by reason of imports of uncoated groundwood paper from Canada that the U.S. Department of Commerce (Commerce) has determined are subsidized and sold in the United States at less than fair value.” Indeed, other issues related to publishing — mostly declines in circulation and advertising rather than Canadian subsidies — are responsible for changes in the paper markets. Those markets are regional rather than national, making national-level tariffs all the more illogical. Many legislators, including Pennsylvania Sens. Bob Casey and Pat Toomey, recognized the folly of the tariffs and called on the ITC to overturn them. Ideally, the decision will inform the administration on studying actual market dynamics before rushing to impose tariffs.

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