The Pittsburgh Citizen

The AFL-CIO’s annual conference was held here in Pittsburgh at the David L. Lawrence Convention Center one week before international leaders converged on the city for the G-20 summit. On Tuesday, September 15th, President Obama addressed delegates of the largest coalition of labor unions in the country. His speech focused on promoting healthcare reform but there were plenty of sidebar conversations on the convention floor among union delegates about the recent tariffs imposed on Chinese tires.

On September 11th, President Obama imposed a 35 percent tariff on Chinese tires imported here for cars and light trucks. This act seeks to protect jobs of American workers in the rubber industry. As a retaliatory measure, the Chinese threatened to impose tariffs on American goods including automobiles.

This action the president took only two weeks before the G-20 seems to be in direct contradiction to a statement he made during the international summit here in Pittsburgh. "We have rejected the protectionism that could deepen this crisis. ... This cooperation between the world's leading economies signals our support for open markets."

Stuart Hoffman, Chief Economist and Senior Vice President at PNC, believes the tire tariff was a step in the wrong direction on the world’s road to economic recovery. On the same day President Obama spoke at the AFL CIO conference, Hoffman spoke at a League of Women’s Voters event held at Point Park University. During his speech, Hoffman talked about the Smoot-Hawley Tariff Act of 1930. The act initially intended to stimulate economic activity ultimately led to a deepening of the Great Depression.

Hoffman believes that a lack of international communication enhanced Smoot-Hawlley’s negative effects on the world economy. The G-20 was formed in 1999. In the 1930’s there was no equivalent to this world economic forum. Hopefully, conversations that took place here in Pittsburgh inside and around the G-20 will help to prevent a prolonging of the economic crisis.