Anti-Dumping Commission

In 2007, Kevin Rudd and Wayne Swan expressed concern about ‘price pressures’ facing ‘ordinary Australians’. When elected, they established the ill-fated FuelWatch and Grocery Watch schemes (including a Petrol Commissioner at the ACCC). While these schemes were a joke, at least Rudd and Swan expressed concern (and seemed concerned) about the high prices that consumers faced in Australia.

Now Kevin Rudd Mark II has established the Anti-Dumping Commission which commenced operations on 1 July 2013. We don’t know yet who will be appointed as the  new Anti-Dumping Commissioner.

In other words, Rudd Mark II and his Labor Party want Australian consumers to pay more.

The Productivity Commission has published a brief history of Australia’s anti-dumping policy. In short, Australia was the world number one user of anti-dumping actions for many years in the 1980s. The Howard Government finally abolished the Anti-Dumping Authority in 1998, with Customs becoming responsible for handling the remaining anti-dumping cases.

Catallaxians know well that a Government agency will always find work. So the new Anti-Dumping Commission can be expected to find cases of dumping and act to show that it is helping Australian manufacturers hurt by the so-called dumping. We can thus expect a rapid increase in anti-dumping cases.

We also know that anti-dumping is just a cute way of providing protection to some Australian manufacturers who don’t like to face foreign competition. Anti-dumping is harmful to the Australian consumer, weakens competitive pressures and reduces productivity growth. Ultimately anti-dumping harms living standards.

Kevin Rudd wants Australia to be a manufacturing country. His model is North Korea, for autarky is the best way to ensure dominance by domestic manufacturers.

(Note: The Australian Customs Service has published further information on the new Anti-Dumping Commission).

This entry was posted in Economics and economy. Bookmark the permalink.

44 Responses to Anti-Dumping Commission

  1. stackja says:

    Let us have a debate.
    What do Aussies want for work?
    No farms? Trust China to feed us?
    No factories? Trust China to supply us?
    How many jobs for the semi-skilled?
    How many can do trades?
    How many office jobs?
    How many law?
    How many medical?
    MSM and other publishing will go of business.

  2. Marko says:

    Is this related to the “anti-dumping” of PMs rule-changes in the ALP?

  3. Jim Rose says:

    consumers must be protected from the scourge of lower prices

  4. desipis says:

    In other words, Rudd Mark II and his Labor Party want Australian consumers to pay more.

    In other words, Samuel J wants Australians to suffer from higher unemployment so international players can make a buck destabilising local supply.

  5. JC says:

    You moron Desi. You indescribable dunce. There’s a free market in the high technology we import. There’s a free market in our farm products. You want the high tech firms and our farmers to have price controls at the floor?

    You deserve a serious smack across both ears, you idiot. Q&A audiences make better leftarded comments and the ABC gets those idiots from various sheltered workshops.

  6. Samuel J says:

    Desi – I want low unemployment, high living standards, freedom and free trade (among other things). Anti-dumping helps keep wages low (because it reduces productivity growth), it does not help employment.

    The Gillard/Rudd Government IR legislation is the principal reason for any increase in unemployment. As Ted Evans once said, unemployment is a policy decision. Well IR legislation is that policy decision and by supporting Fair Work, Rudd is in favour of higher unemployment. By supporting the Anti-Dumping Commission, Rudd is in favour of high prices and low wages.

    By the way, Rudd is also in favour of high taxes.

    So there’s Rudd’s revealed preferences: low wages, high unemployment, high prices, high taxes.

  7. JC says:

    SJ

    There should be a floor on IQ for leftwing commenters here. That’s a floor I’d wholeheartedly support.

  8. Richard Bender says:

    A few years back, a Holden Monaro cost more here than the same car (as a Pontiac) did in the US. So I assume that Rudd will tell General Motors that in future it can’t sell the Commodore in the US cheaper than it does here due to the terrible impact on US manufacturers? Or will Rudd sell it as a successful Australian export story?

  9. desipis says:

    Anti-dumping helps keep wages low (because it reduces productivity growth), it does not help employment.

    Dumping does nothing to improve productivity. If anything it reduces productivity due to the lost capital when firms that cannot sustainably compete at below-cost prices abandon production.

  10. Procrustes says:

    Yeah, yeah I agree that this is dopey but it is a pre Rudd decision

    Idiocy credit where idiocy credit is due

  11. desipis says:

    There should be a floor on IQ for leftwing commenters here.

    An IQ floor for right-wing commenters here would rule out 95% of the comments.

  12. Samuel J says:

    JC: leftwing commentators and IQ. Isn’t it inversely proportional? The lower the IQ, the more leftwing a person tends to be. The higher the IQ, the less leftwing.

    In fact, there is a well-established equation to demonstrate this: Y = 3X + 100.

    Y = IQ
    X is left wing /right wing. An extreme left wing person is X = -10. A right wing person is X = +10.

    So an extreme left wing person has IQ = 3 (-10) + 100 = 70
    A centrist has IQ = (3) (0) + 100 = 100
    A right winger has IQ = (3) (10) + 100 = 130

  13. Will says:

    Dumping does nothing to improve productivity. If anything it reduces productivity due to the lost capital when firms that cannot sustainably compete at below-cost prices abandon production.

    Dipstick-

    The selling of low cost goods into Australia improves productivity as resources are moved from less efficient industries to more efficient industries.

    When industries are protected it just reduces productivity and lowers economic growth and living standards.

  14. desipis says:

    resources are moved from less efficient industries to more efficient industries.

    Except with dumping there are no ‘more efficient’ industries. There’s just game playing and economic sabotage.

  15. Leigh Lowe says:

    In fact, there is a well-established equation to demonstrate this: Y = 3X + 100.
    Y = IQ
    X is left wing /right wing. An extreme left wing person is X = -10. A right wing person is X = +10.
    So an extreme left wing person has IQ = 3 (-10) + 100 = 70
    A centrist has IQ = (3) (0) + 100 = 100
    A right winger has IQ = (3) (10) + 100 = 130

    For the Spud Peeler X = -33

  16. Big Jim says:

    As a small business owner, I agree we are being taxed out of existence these days. Certainly the incentives to actively cut staff are immense; but could you please go over the part of the argument again where you explain how anti-dumping causes unemployment or is directly connected to Fair Work legislation and similar mass-bankrupting ‘initiatives’.

  17. Will says:

    Except with dumping there are no ‘more efficient’ industries. There’s just game playing and economic sabotage.

    mining, agriculture, fisheries, financial services, potentially health and education, are all efficient industries. If wealth increases due to people not having to pay high prices for inefficiently produced local goods, they have more money to spend elsewhere in the economy.

    overseas producers don’t care if you are a dipstick and don’t want to buy from them, they go and sell somewhere else. Only a paranoid moron would think that their objective is economic sabotage.

    Everyone benefits from free trade and specialisation. It is how prosperity evolves.

    Countries who do not engage in free trade, like North Korea, are grindingly poor.

  18. Tel says:

    Government has absolutely no idea what might be reasonable prices and what might be dumping prices. Any time a government gets involved with price setting in any way, they screw it up.

    That’s not to say that private enterprise always plays fair, nor is it to say that all trade is good trade, but there are three criteria required before you have any potential advantage of government involvement: [1] there has to be a problem, and [2] government has to know how to fix the problem, and [3] all the individual people in government need to have a genuine incentive to get the thing fixed. You can find cases of [1], possibly a few cases of [2] but basically impossible to find all three at once.

  19. Tel says:

    … mining, agriculture, fisheries, financial services, potentially health and education, are all efficient industries …

    Agreed. You don’t see to many foreign companies “dumping” wheat, wool, iron ore and coal onto the Australian commodities market. I would guess there’s a reason for that.

  20. Will says:

    As a small business owner, I agree we are being taxed out of existence these days. Certainly the incentives to actively cut staff are immense; but could you please go over the part of the argument again where you explain how anti-dumping causes unemployment or is directly connected to Fair Work legislation and similar mass-bankrupting ‘initiatives’.

    Protecting some industries results in higher employment in those industries, but at the expense of all other sectors of the economy. The higher prices paid for protected goods is money not being spent elsewhere in the economy. It is likely that general employment would be higher in the absence of tariff and anti dumping measures. However, as you have observed, the regulatory and tax environment has a bigger impact on general employment levels.

    Many protected industries (such as the car manufacturing industry) are heavily unionised. The protection shields these workers from competition they would otherwise face, likely resulting in the reduction or elimination of their industry. Industry protection preserves union power to some degree.

    It is interesting that most protected industries have very poor productivity, resulting from low investment in capital and modern technology. This makes the inevitable demise of the industry so much more certain. I am particularily thinking of tank manufacturing in this country, which is a classic case study. So much of Australian manufacturing falls down not so much due to high wages, as lack of investment due to poor profitability. This is due in lack of large scale markets and union rules lowering productivity.

  21. desipis says:

    The higher prices paid for protected goods is money not being spent elsewhere in the economy.

    Money spent on imports is not spent elsewhere in the Australian economy either. At least the taxes and wages paid by businesses located in Australia will have a reasonable chance of being spent in Australia as opposed to the money that goes to the dumpers overseas. There’s also the longer term impact of higher prices after the local industry is trashed and the subsidised or opportunistic causes of the lower prices of the dumped goods disappears. If the overseas supplier is cheaper simply because they’re more efficient (and hence the lower prices are sustainable) then it’s not dumping.

  22. JC says:

    Money spent on imports is not spent elsewhere in the Australian economy either.

    This so stupid at the basic level, it’s funny.

    If the overseas supplier is cheaper simply because they’re more efficient (and hence the lower prices are sustainable) then it’s not dumping.

    Doofus,

    Do you understand the production of services is essentially a bet on the future that may be wrong? Do you understand the complexity of production cycles? Firms may have overstocked and then forced to sell their production at the marginal price.

    If a consumer picks up the cheaper product more power to them…literally. More purchasing power.

    You’re basically denying the operation of comparative advantage.

    Go away Desi as you’re embarrassing the species and after people like Shane Wand, the Lying Slapper, Kevin Peron-Rudd, Tim Flannery and Clive Happy Hamilton we have a lot to be embarrased about. Stop adding to it.

  23. JC says:

    Money spent on imports is not spent elsewhere in the Australian economy either.

    Yes it is, you idiot. You buy the product or the service from a store or even online which provides service jobs domestically even at the most indirect level. Buying imports also helps depress the Dollar giving our exporters a more advantageous exchange rate.

    You’re mercantilist now, desi, you ignoramus.

    At least the taxes and wages paid by businesses located in Australia will have a reasonable chance of being spent in Australia as opposed to the money that goes to the dumpers overseas.

    Think of an online trade. You buy a pair of shoes online through Amazon. You pay in US dollars. You have to buy the US Dollars by selling Australian dollars. Those Australian dollars you sold are then purchased by someone buying Australian materials, or even our stocks of bonds.

    Shut up, you idiot.

    There’s also the longer term impact of higher prices after the local industry is trashed and the subsidised or opportunistic causes of the lower prices of the dumped goods disappears.

    So overseas suppliers don’t compete in the Australian market for share? Mercedes and BMW don’t really compete here, right?

    You idiot.

    If the overseas supplier is cheaper simply because they’re more efficient (and hence the lower prices are sustainable) then it’s not dumping.

    And the point is what eggsactly, dumphy.

    Get back to SL’s blog where you can talk about the Woe Mens and her last trip to Oxford.

  24. JC says:

    There’s enough Peronist thinking right now in the Australian Left for the entire 21 century, Desi. Stop adding to this abomination.

    Seriously the greenslime and the Liars Party ought to comibine and start speaking Spanish. The resemblance to the Peronist party would then be unambiguous.

  25. desipis says:

    Firms may have overstocked and then forced to sell their production at the marginal price.

    So the overseas firms get to make a buck, and the local suppliers go bankrupt. What do the local consumers do when the overseas firms are no longer overstocked? Get screwed by lack of local supply? Buy the now high priced imports?

  26. desipis says:

    JC, why would I want to go anywhere when your rants are more entertaining than a radical feminist trying to justify her transphobia?

  27. JC says:

    So the overseas firms get to make a buck, and the local suppliers go bankrupt.

    Why would Overseas firms be the only ones to be overstocked you dope. What if the Australian firm is overstocked and needs to unload product at the marginal cost in order to get it’s money back? Would that be defined as dumping or because you support the Australian Peronist parties, you think it’s okay if the Aussie firm does it.

    What do the local consumers do when the overseas firms are no longer overstocked?

    So the assumption is that the market is incontestable?

    Get screwed by lack of local supply? Buy the now high priced imports?

    Fuck you’re an imbecile. Why would you assume that only domestic suppliers can offer competition in a contestable market, you dummy?

  28. JC says:

    JC, why would I want to go anywhere when your rants are more entertaining than a radical feminist trying to justify her transphobia?

    Because you’re a glutton for punishment. Obviously.

    You realize that the Cat is the 9th circle of Hell for lefties. They never leave here without serious mental disturbances.

  29. JC says:

    Perón’s public speeches were consistently nationalist and populist. It would be difficult to separate Peronism from corporate nationalism,

    Yep, Desi and the Liars Party are following exactly in the Juan’s footsteps. Even the Finkelstein laws were an attempt to head in that direction.

  30. desipis says:

    You realize that the Cat is the 9th circle of Hell for lefties. They never leave here without serious mental disturbances.

    While the collective ignorance is rather confronting, the insults are all rather tame.

  31. JC says:

    Desi

    Stop trolling. Answer the questions I asked.

  32. dd says:

    There’s also the longer term impact of higher prices after the local industry is trashed and the subsidised or opportunistic causes of the lower prices of the dumped goods disappears.

    If you’re anti-dumping then you must be anti- sending used clothes to Africa. That’s dumping. All foreign aid, in the form of goods of any kind, is dumping. And actually it really does hamper local producers and sellers. But even so the overall effect is good because Africans get free (or cheap) clothing and the entrepreneurs can direct their efforts to other things instead.

    So I’m in favour of aid, and I’m also in favour of Australians buying cheap imports.

    The whole point of the modern world is to specialise. Self-sufficiency is a pre-modern idea; the modern world, the industrialised world, is about trade. It’s about interconnectedness.

    (why don’t people get that? is there some deficiency in the schooling system?)

  33. Gab says:

    Beautifully said, DD.

    Also this:

    The whole point of the modern world is to specialise. Self-sufficiency is a pre-modern idea; the modern world, the industrialised world, is about trade. It’s about interconnectedness.

    sort of reminds me of I, Pencil as demonstrated by Milt Friedman.

  34. Dianeh says:

    There are many reasons why goods come into this country at below the cost it can be produced here. And in a lot of cases it is because of govt subsidies. This is very different to simply a lower cost base in the competing countries. For eg why should our tinned tomato manufacturers go broke because they cannot compete with the Italian tinned tomatoes that have three sunsidies. One to grow the tomatoes, on to manufacture it and one to export it. And due to the never ending source of funds for Europe, marke forces have not brought their inefficient industry to its knees. Instead it is ours that has gone.

    When govts are involved, markets are skewed, and it takes govt action to counter it. Take Brazilian OJ. They have been importing heavily subsidised Oj for at least 30 years and in that time Brazil has gone broke, had its debts forgiven and still continues to subsidise (used to be around 80%). Why should this be allowed to happen? Where is the return for our farmers and producers who efficiently produce the OJ? Free markets and efficiency has not worked, as it just cannot match a high level of govt interference that appears able to go on forever (30 years is forever)

    This is what the anti dumping should concentrate on. Unfair govt subsidies. It should not be about saving inefficient industry or union jobs. It should be about stopping foreign govts from destroying our industry.

  35. Dianeh says:

    Btw, I totally agree that we should not subsidise or create import tariffs simply because a country can produce at lower cost than us. But where they cannot (such as in Europe), then our local industry should not suffer because of foreign govt interference allowing for artificially cheap prices.

  36. The selling of low cost goods into Australia improves productivity as resources are moved from less efficient industries to more efficient industries.

    Will, I’m not an economist, but doesn’t that statement presuppose the government has not erected barriers to that movement of resources? (ie greentape, labour laws, etc.)

  37. dd says:

    There are many reasons why goods come into this country at below the cost it can be produced here. And in a lot of cases it is because of govt subsidies. This is very different to simply a lower cost base in the competing countries.

    No, it’s no different. We can’t change the world. If foreign governments want to buy our food and electronics for us, or pay half the bill, then there’s nothing we can do about it but accept their largesse and pocket the savings. There is no point in producing stuff locally that foreign governments are prepared to give us.

  38. dd says:

    Also, dumping often occurs when there’s oversupply, in which case it’s a legitimate market signal.

  39. Dianeh says:

    So then it’s all right for a foreign govt to effectively cripple industries in this country.

    The oversupply you talk about comes due to govt subsidies. And the upshot is an artificially produced oversupply here in this country with our producers and farmers bearing the brunt of it.

    You would not let a foreign govt come here and physically destroy an industry but you will let them do it through economic means.

    Not talking about inefficient industry like the auto industry here. They can’t compete even with the odds stacked for them.

  40. dd says:

    I don’t know dianeh.
    I guess my point is that in many cases, dumping is either
    a) the result of over-supply (in which case, it’s reflecting reality and we need to suck it up)
    b) basically foreign governments giving us stuff for free.

    That doesn’t mean it’s always right or always shouldn’t be resisted. Some examples would be very helpful however. Seriously, what are some recent examples of ‘dumping?’

  41. I don’t think you could call it an example of dumping DD, but personally I think the Mitsubishi 380 was one of the best cars Australia produced. (Yes, I know it takes all kinds.) Now I don’t know why it failed, but I do know that straight after, the Chinese dismantled the factory and took it back to China. It’s not the vehicle I’m concerned about, it’s the factory which could have been diverted to producing other stuff. remember WW2 was not about destroying the other mobs tanks and aircraft – it was about destroying the means of producing them, and the fuel to run them.
    The Germans lost 3 out of 5 Tiger Mk 2 because they were destroyed by their crews due to lack of fuel, or minor spare parts like tracks. And they couldn’t recover them due to fuel issues.
    We are losing our industrial base and if we need it, we won’t have the time to start a new one. I have nightmares about this, because it will cost a lot of blood to make up for the lack of kit.

  42. dragnet says:

    Yay lets hear it for the Mitsubishi 380!! 🙂

  43. dragnet says:

    Really truly. I have one.

  44. jumpnmcar says:

    Rudd is the ’86 Mitsubishi Magna of Australian politics.
    If you’ve ever had one you’ll know what I mean.

Comments are closed.