Archive for the ‘protectionist’ Category

Dallas Federal Reserve Chief, China, Germany All Call Protectionism “Death”

February 2, 2009

Dallas Federal Reserve President Richard Fisher cautioned Monday that protectionist tendencies are dangerous, calling them the “crack cocaine” of economics.

Speaking on C-Span, Fisher addressed a proposed congressional fiscal stimulus law that would offer “Buy America” provisions in an effort to encourage the purchase of domestic goods. However, such provisions are dangerous, Fisher warned. “Protectionism is the crack cocaine of economics … (it) leads to economic death,” he said.

“We just cannot afford to go down that path,” Fisher added.

The Dallas Fed President just concluded his term as a voting member of the Federal Open Market Committee. Known as one of the most ardent inflation hawks in the nation’s policymaking body, Fisher added in his comments that failure to remove added liquidity from the system in a timely manner could result in serious price inflation.

The Federal Reserve needs to be cautious that their excessive lending and record low interest rates, set at a target range between zero and 0.25 percent, Fisher said, warning that an inflation problem could be “baked” into the country’s economic outlook.

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LONDON  — Visiting Chinese Premier Wen Jiabao on Sunday warned against protectionism in face of lingering global financial crisis.

Speaking at a meeting with former British Prime Minister Tony Blair, Wen said as international financial crisis is spreading, his visit to London was to send a message of confidence for Britain and China to join hands in overcoming current difficulties.

He noted that the two sides should further explore the potential for cooperation, and guard against trade protectionism, in particular.

Read the rest from China Daily:
http://www.chinadaily.com.cn/china/2009-02/02/conte
nt_7435205.htm

Related:
Economy Sparking Protectionism, Global Trade Disputes?

 Obama Forced to Rethink “Buy American” in Stimulus After Hits from China, Germany, Others

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Obama Forced to Rethink “Buy American” in Stimulus After Hits from China, Germany, Others

January 31, 2009

President Barack Obama’s administration will examine a “buy American” requirement in economic stimulus legislation that has raised concern among U.S. trading partners, White House press secretary Robert Gibbs said.

The administration “will review that particular provision,” Gibbs said today at his regular briefing. The president’s advisers understand “all of the concerns that have been heard, not only in this room, but in newspapers produced both up north and down south.”

He refused to say whether the administration supported or opposed keeping that part of the legislation intact. Nor did he say what the president would do if the provision remains once the bill clears the House and the Senate.

The issue may cloud Obama’s trip to Canada on Feb. 19, his first journey outside U.S. borders as president. Officials in Canada, the top U.S. trade partner, are criticizing a part of legislation that passed the U.S. House of Representatives Jan. 28 that requires the use of U.S.-made iron and steel in infrastructure projects.

“U.S. protectionism is about to make Canada’s recession a lot worse,” Ralph Goodale, house leader for the opposition Liberal Party, said today in Parliament.

Read the rest:
http://www.bloomberg.com/apps/news?pid=2
0601087&sid=a37pHeTuz_HA&refer=worldwide

Global Economy Sparks Protests; Governments Fear Greater “Social Unrest”

January 31, 2009

Americans just started a new presidency but in China, Russia, France, Iceland and Britain, some leaders already fear that the worsening global economy will result in calls for new governments with new leaders and ideas.

Protesters in Rusia’s eastern most industrial hub and seaport, Vladivostok, called this week for new government leaders because of the economic down turn.

Opposition groups led by Communists protested the economic policies of the Russian government in the eastern city of Vladivostok on Saturday.
James Hill for The New York Times

The protest was peaceful; but more protests are planned.  And previous protests like this one in Russia ended in violence and the police making dozens of arrests. 

The crowd called for the replacement of Dmitri Medvedev and Vladimir Putin, Russia’s top leaders, for mismanaging the economy.

On Saturday protesters held demonstrations throughout Russia, offering largely subdued, but pointed criticism of the government’s economic policies as the country continues to sink deeper into an economic morass, the New York Times said.

In Britain, Prime Minister Gordon Brown is under fire.  He is currently taking heat for a jobs and rights protest that stems from his pledge that “British jobs need to be British.”
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Thousands of workers across Britain have walked off their jobs following protests over the use of foreigners at a Lincolnshire oil refinery.

On Saturday, the number of strikers multiplied, with hundreds of energy workers across the UK protesting — and with lines of police around them.

And millions of Chinese have gone home for the Spring Festival or New Year and told not to return to their jobs.  China is so worried about domestic unrest that it has started its largest anti-democracy crackdown ever: specifically targeting the media and Internet.

“People have this psychology of crisis,” said Victor Yuan, chairman of Beijing-based consultant Horizon Research Consultancy Group, which does polling for the private sector and the government.

Horizon’s latest survey showed consumer confidence at its lowest since the outbreak of severe acute respiratory syndrome, or SARS, in 2003.

“The real, real winter for the Chinese economy hasn’t come yet,” said Chen Jian, chairman of Hangzhou Hengwei Investment Co., which has business in restaurants, real estate and trading.

In France, President Sarkozy can’t get away from the jeers and shouts of protestors when he makes public appearances.  He has taken to firing public officials that  don’t keep protesters far away from the President’s ears.

A crowd of 300,000 protested in Paris this week in the largest protest in 10 years, some said.

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Paris this week

Countries such as France and Greece have been hit by riots and strikes as militant unions demand protectionist measures to keep out foreign rivals.

And both Germany and China expressed fears of American protectionism this week.  Angela Merkel of German told audiences at the economic conference in Davos that the U.S. auto bailout hurts the global economy and spells a new era of protectionism from the U.S.  China’s Hu Juntao told President Barack Obama that the “buy American” provision in the stimulus was rank protectionism and needed to be scuttled.

The economy has made the entire world more tense.

The French Finance Minister Christine Lagarde said, “We’re facing two major risks: one is social unrest and the second is protectionism.”

“We need to restore confidence in the systems and confidence at large,” she added.

Christine Lagarde
Lagarde

Former U.N. Secretary-General Kofi Annan says the world body needs to be reorganized in view of the economic crisis.

“The current architecture of managing global affairs is broken and needs to be fixed,” Annan said.

The worldwide economic recession has exposed a “crisis of global governance” that can only be addressed by the radical reform of the United Nations, said Mr. Annan.

And Britain’s Prime Minister Gordon Brown has called on world leaders to set about reforming international financial institutions to prevent a repeat of the circumstances that led to the current financial crisis.

“We’ve got to be far bolder and far more imaginative,” Brown said. “We want to create a global society. But we need to have global institutions that work and the problem is the institutions we built 60 years ago are out of date.”

By John E. Carey
Wakefield Chapel, Virginia

The BBC on Russian Protests:
http://news.bbc.co.uk/2/hi/europe/7862370.stm

Related:
Britain:
 Oil refinery strikes: Protests over foreign workers

France’s Sarkozy Getting Testy Amid Public Disapporval, Fires Public Servants

China, Germany Both Pressure Obama on Protectionism

Kofi Annan: Global Economy Tells Us, New forms of government needed

From CNN:
http://www.cnn.com/2009/BUSINESS/0
1/31/davos.wef.brown/index.html

http://www.cnn.com/2009/BUSINESS/0
1/30/britain.refinery.strikes/index.html

Paris:
http://www.belfasttelegraph.co.uk/news/
world-news/300000-protest-in-paris-14
162666.html?r=RSS