Cato Daily Dispatch for November 19, 2003
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The Daily Dispatch will not be issued Thursday, November 20, due to the 21st annual Cato Institute Monetary Conference.
U.S. to Put Quotas on Chinese TextilesSchwarzenegger: 'Severe' Cuts Needed
America and Europe Clash over Iran
U.S. to Put Quotas on Chinese Textiles
"The Bush administration announced plans Tuesday to impose quotas on Chinese textile imports, protecting another U.S. industry from foreign competition and increasing pressure on Beijing to address a growing trade imbalance," the Los Angeles Times reports.
"The decision, which applies to Chinese-made brassieres, dressing gowns and knit fabrics, is expected to roil relations with a country that has become a lightning rod for anxiety about U.S. trade deficits and job losses."
In "Threadbare Excuses: The Textile Industry's Campaign to Preserve Import Restraints", Cato trade policy analyst Dan Ikenson argues that "the enormous costs of textile protectionism have been borne disproportionately by America's lower-income families, who spend a higher proportion of their earnings on clothing. Textile protectionism has also deprived poor countries of export opportunities-precisely the kind of opportunities the Bush administration identifies as vital for promoting economic stability and security."
A comprehensive archive of Cato trade publications relating to China can be found at the Center for Trade Policy Studies website.
Schwarzenegger: 'Severe' Cuts Needed
"California Gov. Arnold Schwarzenegger (R) unveiled key parts of his plan to solve the state's budget crisis Tuesday, proposing as much as $15 billion in borrowing and strict new limits on government spending," according to The Washington Post.
"On his first full day in office, as the Democratic-controlled legislature convened a special session at Schwarzenegger's request, the new governor also said 'severe' budget cuts will be necessary to help erase California's huge budget deficit."
The benefits of state constitutional spending limits are detailed in "How to Fix California's Fiscal Problems: A Guide for Schwarzenegger", by Cato Adjunct Scholar Michael New. "A constitutional spending limit has been gaining a great deal of currency in California in recent months," New writes. "In fact, both of the Republican candidates for governor, Arnold Schwarzenegger and Tom McClintock, came out in support of a constitutional limitation on expenditures. That is a good start.
"However, more needs to be done. When [Governor] Scharwarzenegger introduces a fiscal reform plan, he needs to detail how a spending limit can provide tax relief, prevent future fiscal crises, and revive the California economy. Indeed, if the recall election results in the enactment of a constitutional spending limit, the recall effort could pay dividends for years to come."
America and Europe Clash over Iran
According to The Guardian, "Europe and the US clashed last night when Washington said publicly that it disagreed with the EU's position on the nuclear threat posed by Iran.
Colin Powell, the US secretary of state, who joined President George Bush in London last night at the start of the state visit to Britain, had been seeking to mend fences after months of disagreements over Iraq."
In "Logical Conclusions: North Korea, Iran, and Unintended Consequences", Cato Vice President for Defense and Foreign Policy Studies Ted Galen Carpenter contrasts Washington's stances on non-nuclear powers such as Iraq and Yugoslavia, with its kid-glove approach to nuclear China, Russia and Pakistan. "The lesson that ... Iran learned (and other countries may be learning as well) is that possessing a nuclear arsenal is the way to compel the United States to exhibit caution and respect," Carpenter concludes. "That is especially true if the country has an adversarial relationship with the United States."
Christopher Kilmer, editor, ckilmer@cato.org
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