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In the 1970s and 1980s, the US tax code provided for a so-called domestic international sales corporation (DISC). An exporter in the United States could set up a subsidiary that was not taxed on a certain percentage of export sales. This would offset some of the disadvantage. This was the state of our law for many years, until the WTO

India uses many of the tools of modern mercantilism. It has high tariffs, a bureaucracy focused on keeping imports out, and a system of industrial policy and protectionism. Its average MFN applied tariff rate of 17.6 percent is the highest of any major world economy

the International Monetary Fund (IMF) in 2014 estimated Germany’s inflation-adjusted exchange rate was undervalued by 5 percent to 15 percent and that the euro had fallen substantially even from that time. Second, he found that the surplus is buoyed by Germany’s tight fiscal policy that suppresses domestic spending—including on imports.

a very large part of the trade between the United States and the European Union is in automobiles and auto parts. The United States has a 2.5 percent tariff on these products and Europe has a 10 percent tariff. That is a $3,700 difference on a $50,000 car

Section 301 of the Trade Act of 1974 states that if there is an “act, policy or practice” of a foreign government that is “unreasonable or discriminatory” and “burdens or restricts U.S. commerce,” the president, acting through the USTR, can take “all appropriate and feasible action” to counteract that policy—and this includes placing tariffs and restrictions on imported products coming into the United States

paralysis at the WTO means that inequities built into the Uruguay Round Agreement that are damaging to US interests remain. The three most serious are disparate tariff rates, the developing country loophole, and exceptions to MFN treatment that threaten to swallow the rule

in losing manufacturing jobs, the United States also “broke the chain of experience that is so important in technological evolution. As happened with batteries, abandoning today’s ‘commodity’ manufacturing can lock you out of tomorrow’s emerging industry.”

engineers on the ground are the ones who incorporate much of what we call productivity gains

All the great economies were built behind a wall of protection and often with government money. The British industrial revolution was aided by a wall of tariffs. Likewise, the late-nineteenth-century explosion of American industry was the product of protectionism and often subsidies

“The world is laughing at American politicians as we protect ships we don’t own, carrying oil we don’t need, destined for allies who won’t help.”