Coated Paper Case Ruling and the Future of Print
By now I’m sure you have all read about last Friday’s ITC ruling in the coated paper case, and the fact that APP (Asia Pulp & Paper) will appeal. Already, the blogosphere is crowded with comments pro and con.
Let me try to add some perspective.
We want free trade, but we want jobs. We don’t want jobs shipped offshore, but we want our cheap imported products from China or Costa Rica or wherever. We can’t have it both ways. What some of us seem to want is the cheap imported goods, as long as our jobs are secure. We buy from Wal-Mart and then complain that our manufacturing base is gone.
Forget for a moment what’s best for you or for me—what’s best for our country? Unlimited free trade, with no limits on dumping and foreign subsidies as we lose jobs overseas? Or extreme protectionism? I think most of us would agree that we need to be in between somewhere. And we can all disagree on “in between” we need to be.
As for this case, printers and merchants who are benefiting from low-priced paper imports are against the duties; those who have to compete with them are in favor of the duties. It’s not ideology; it’s business.
It has been argued that the paper industry is hypocritical to be complaining about subsidies when it has gotten billions in black liquor tax credits. This is a fair criticism. I think the black liquor credits represented a failure of our government to do its homework and look at the full picture. But don’t blame the mills—who among us would voluntarily turn down a legal tax deduction? And, more to the point, these credits were temporary and they are no longer in place.
Let’s try to clarify a few things. The U.S. industry is not losing market share because it has not invested in technology. Domestic suppliers are losing share to foreign mills with lower labor costs, lower environmental costs, artificially devalued currency in China, and now, according to the findings in this case, illegal subsidies. Would you invest in new papermaking technology in a declining market when faced with these realities? I wouldn’t. Frankly I’d have an exit strategy.