Author Topic: See the Trade War from Your Harley  (Read 1934 times)

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Offline EasyAce

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See the Trade War from Your Harley
« on: June 26, 2018, 07:26:05 pm »
Harley-Davidson, who've learned the hard way, now seeks relief from Trump's trade war.
By Yours Truly
https://www.themaven.net/theresurgent/community/see-the-trade-war-from-your-harley-rphZsmmuHEKv9yqj2WxEhw/

A duo from the South who named themselves for a type of catfish came up with a pleasantly, quietly bluesy, rollicking evocation of the biker's life in 1972 and fairly startled the top twenty on the Billboard music chart:

We'll get matching jackets and helmets, too/We'll get respect from the towns we ride through/We'll sleep at the roadside in the soft green grass/and if the squares walk by we'll let them pass/You'll be the queen of my highway/my motorcycle mama/and we'll see the world from my Harley.

Sailcat proved a one-hit wonder, but they purred over the radio what several generations of bikers felt in their hips, that a Harley-Davidson motorcycle on the road was what a Gibson guitar was (and still is, somehow) to music, the perfect marriage of form to function. At the time, however, "
Motorcycle Mama" was a shot in the arm Harley-Davidson hardly expected, considering what became of it by the time the song reached number eighteen, its highest national chart showing.

Twenty years earlier, Harley-Davidson was what they're not now, seekers of protection, applying to the Commerce Department for a forty percent tariff on import bikes. The U.S. Tariff Commission politely advised Harley-Davidson to hit the road, Jack, and the company was charged instead with restrictive trade practises, giving a big win to such imports as the appropriately enough named Triumph from Britain.

By 1972, Harley-Davidson was owned by American Machine Foundry, whose acronym AMF should be familiar to anyone who has ever rolled a bowling ball, and whose attempts to streamline H-D---including cuts in the company's work force---were clumsy enough to provoke a strike and deliver products very unlike the rugged bombs that made the company's name in the first place. "Hardly Driveable" was probably the most polite pejorative thrown at the product.

Perhaps realising at last that they were far more talented at making bowling equipment than motorcycles, AMF sold Harley-Davidson in 1981 to a group whose leaders included the grandson of a company co-founder. Proving perhaps that they'd learned little from their own history, Harley-Davidson promptly decided that the Japanese were selling a few too many of their more compact and often flashier looking wares in the United States. (The Hell's Angels, among America's most conspicuous riders of Harley-Davidsons, tended to call such elaborate rigs "garbage wagons" even before the Japanese bikes became more visible on these roads.) And they went to Washington for relief.

They got it when the U.S. International Trade Commission agreed that Japan's motorcycles were just too popular for our own good, and Ronald Reagan imposed a very temporary 45 percent tariff on imported motorcycles with engines larger than 700cc. Then H-D did what it should have done in the first place, building or perhaps more properly rebuilding their products. They began building bikes that harked back to their glorier years in style and substance, and little by little American customers came home to Harley. How iconic the company has long since become can be measured somewhat garishly by the sight of a large replica Harley crashing through the upper corner of its Las Vegas theme restaurant.

More businesses than you can name in one breath have learned the hard way over decades of trial, error, re-trial, and more error. Donald Trump, a businessman whose brand is more successful than many of his actual products, hasn't. And he's oblivious as to why the European Union imposed a 25 percent tariff on a host of American products last week. "Based on the Tariffs and Trade Barriers long placed on the U.S. & its great companies and workers by the European Union," the president thundered in one of his typically thunderous tweets, "if these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!"

That the European tariffs were imposed in explicit response to Trump's tariffs on international steel and aluminum including from Europe seems to have escaped his radar. That four models of BMW, three models of Mercedes-Benz, and two models of Volkswagen, among others, are built in the United States, has escaped the Artist of the Deal.

Once upon a time willing to ask for tariffs on its behalf, Harley-Davidson contemporarily tries to avoid them. They built their first overseas plant in Brazil to avail themselves of, what do you know, a welcoming free economic zone. They opened a plant in India several years ago in large part to escape Indian tariffs; well before Trump began to channel his inner Smoot-Hawley, they started planning a plant in Thailand for similar reasons. H-D is one of the more fortunate considering they've been a powerful American brand that became a powerful international brand long enough ago. Three Arkansas makers of tire cords, the steel structures that give shape to the tires on which your car rides, aren't that fortunate.

Arkansas Today says those three await the word as to whether they'll get what they asked of the Commerce Department, exemptions from Trump's steel and aluminum tariffs, or whether they'll get no such relief and have to lay off a total of fifteen hundred workers. Reason says over twelve hundred American businesses and counting, what a surprise, have filed up to twenty thousand requests for such exemptions.

"The Commerce Department is sorting through them, one by one," writes Reason's Eric Boehm, "deciding which companies get a special favor from the government and which have to deal with an unexpected new tax that might force layoffs or worse—destroy entire businesses." Your government at work, essentially usurping a market's and your rights to determine who wins and who doesn't. Seven companies won such exemptions last week, and the odds are very favourable that the only one you've ever really heard of off the top of your head is Schick, the razor and razor blade company based in Connecticut. But 56 other companies lost at the same time.

"[T]he idea of the government picking winners and losers used to drive conservatives mad when the Obama administration was seen as doing it in less direct ways," Boehm writes further. That was then, this is now, and the current president among other things is and has been a man who sees things in rigid terms of "winning" and "losing" instead of bigger pictures that show neither is as rigid as he prefers to think.

"Congress can assert its constitutional power over trade, through direct communication with the White House, and even through legislation designed to take back some power it had previously delegated to the executive branch," says the Cato Institute's Simon Lester, who doesn't have the heart to say Congress still seems asleep at that switch.

You'll be the queen of my highway/my motorcycle mama/and we'll see the world from my Harley/if the chain don't break, ended Sailcat's quietly jaunty tribute. There'll be more than two riders spilled onto the road to survive cuts, bruises, and broken bones, when the chain from Trump's trade war breaks.
« Last Edit: June 27, 2018, 12:05:00 am by EasyAce »


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