Saturday, October 14, 2023

My Quasar Microwave

Overall, the new microwave is wonderful.  It is powerful enough to incinerate food in just a few seconds, big enough to cook a turkey (does anyone actually do that?) and even connects wirelessly to one of the household gods, Ahexonya.  Until now, I hadn’t known I needed to control my microwave with voice commands, but it was available and I bought it.  (In case you are wondering, all of the other household gods are feline.)

To be fair, that voice feature turned out to be more useful than I thought.  Without having to remember which button does what, you can simply say, “Ahexonya, defrost at 30% for two minutes, then cook for 3 minutes.”  Or “Ahexonya, reheat my coffee cup.”  This turns out to be as handy as a pocket on a shirt.

As wonderful as all the features were, it had one small drawback—the first unit delivered by UPS turned out not to work, as it was missing a small piece of plastic that turned the glass turntable.  The piece probably cost about the same as those cheap ballpoint pens the banks give away, but without it the microwave wouldn’t work right.  So, the whole microwave had to be re-boxed and shipped back to California while we were forced to wait for a replacement.

Somewhere in China, someone had spent a few minutes looking at a spreadsheet and announced, “In the long run, it will be cheaper to reship units than to implement quality control checks.”  Nowhere in the box was a tiny piece of paper that said, “Inspected by Inspector #8.”

This may change in the future.  Currently, the White House is reexamining the tariff rates on imported goods from China.  Back in 2000, the United States granted “permanent normal trade relations” (PNTR) to China after the country joined the World Trade Organization.  PNTR is almost the same as “most favored nation” (MFN) status, meaning that the U.S. agreed to drop all tariffs on a wide variety of imported goods, including my microwave. 

For most of the Twentieth Century, particularly following World War II, it has been the policy of the United States to promote free trade between countries.  This policy slowed during the Trump and Biden administrations, with Biden stressing the importance of saving American jobs by extending tariffs.

This is a bad mistake.  For the moment, forget that free trade fosters peace among nations.  You can even forget that, in today’s globalized economy, it is almost impossible to protect domestic jobs by erecting tariffs, since tariffs erected against a particular nation will just mean that the foreign goods will be imported through a third nation with higher prices.  You can even forget that the immediate and direct result of protective tariffs is always retaliatory tariffs from the targeted country, something every politician should have learned from the disastrous Smoot-Hawley Act of more than 90 years ago.  (Hell, even Ferris Bueller’s history class knew that.)

Note.  The only real qualification placed on candidates for federal office is age.  Speaking from experience, it doesn’t take any brains to grow old, it just takes a long time.  Perhaps it is time for more stringent standards to be required of potential candidates than for a good bottle of wine or a block of vintage cheese.  Let’s require all candidates to pass a simple test on the Constitution and on American history that includes an essay question on Smoot-Hawley.  This simple test would cancel the eligibility of quite a few current congressmen and at least two recent presidents.

Cancelling PNTR for China will result in American consumers paying an additional $31 billion dollars a year, or roughly $240 a year per household, for the goods we currently purchase.  And that will NOT result in large numbers of local industry suddenly springing up to manufacture American made televisions and microwaves.  It will result in Americans buying fewer goods at higher prices and it will result in American companies selling fewer goods abroad.  And—far worse—it will result in American capital and labor being reallocated to inefficient production, because somewhere, some company will attempt—probably ineffectively—to manufacture an inferior product to attempt to compete with an imported good in the hopes that they can sell their product due to the protective tariff.

Falsely promising to protect domestic jobs has been a mainstay of politicians for more than a century, but by now even the most dedicated isolationist should realize that no matter how many catchy jingles are sung in television commercials, the garment industry is not coming back to the United States and no matter how high the tariff, Quasar and Magnavox are not going to start making American television sets again.  (Ironically, about 40 years ago Quasar was sold to the same Japanese company that made my microwave.)  What these empty promises fail to disclose is that such tariffs will not only be inflationary but most of the burden will hit families with lowest incomes who spend a higher portion of their income on such products compared to families with higher incomes.

America should focus instead on the goods in which we are globally competitive.  American is one of the leaders in production of high quality and high-tech goods where highly productive labor is important.  We lead the world in innovation, research, and development.  And these are the areas where we are likely to be the most successful in the future.  

My new microwave was built in China for a company based in Japan.  The technology, however, was developed in the United States.  A Raytheon engineer named Percy Spenser invented the microwave oven back in 1945 and for years, Raytheon licensed the technology to other companies.   I don’t know what the next generation of appliances will be, but I hope whatever replaces my new microwave is based on technology that came from American laboratories.

There really isn’t any choice since raising tariffs simply won’t work.  America needs global markets to sell our surplus goods meaning we will always have some favored nation trading partners who can sell goods here without tariffs.  Foreign companies that can sell to a global market will have huge advantages in economies of scale that will spread the fixed costs of manufacturing across larger numbers of products, lowering the price per unit.  Domestic companies that seek to produce smaller quantities of goods will have to base those sales on either unique features or significantly higher quality than their mass market competitors.  Those kinds of companies don’t need to hide behind the false protection of a tariff and would suffer from the inevitable retaliatory tariff imposed by foreign countries.

Personally, I’m ready to support a presidential candidate who is willing to admit that we are in the 21st century and that America is not going to go back to ineffective trade policies from the Gilded Age.  I just wish such a candidate was running.

2 comments:

  1. The thing is that if China charges confiscatory tariffs on American goods, then they should not enjoy favored nation or even pseudo-favored nation status. Other than altogether blocking Chinese goods, I am at a loss to explain how we level the playing field other than to give our business to other nations that will give us a quid pro quo on free trade. With encouragement from us, shouldn't we be able to replace China in our trading activities with the cooperation of most of the rest of the world. Trouble is, this senile old coot in the White House probably could no more organize such a multi-nation trade pact than he could climb up the White House front steps.

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  2. If China puts tariffs on our good, we should just stop buying anything from them. They'll go broke before we do.

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