Americans recently were treated to the sight of muscle-bound millionaires taking a knee during the national anthem as a once-beloved institution—the NFL—refused to criticize or condemn it. Meanwhile, owners who make their huge profits in stadiums that are heavily subsidized with tax dollars, for the most part backed the party line of NFL Commissioner Roger Goodell. Nonetheless, the NFL feels no obligation to respect the flag and anthem of the United States, and it feels it should be immune to criticism in the bargain. This is the sort of entitled attitude that Americans find increasingly repugnant—in corporations no less than in individuals.
Yet we see echoes of this attitude all across the culture and even in some places where one might not expect it. Take, for example, the recent controversy over the persistent violations of U.S. trade laws by the South Korean corporate behemoths Samsung and LG. These companies have been dumping washing machines in the United States at prices below market values for years, as they try to undermine their U.S.-based competition. They are also moving their production facilities around the globe in a deliberate effort to avoid the legal consequences, which could include tariffs or quotas. Recently, for the third time, the International Trade Commission found Samsung and LG guilty of dumping, but they and their supporters take the view that no penalties should be applied. Why? They offer two reasons..
The first is that Samsung and LG suggest their recent announcements regarding the building of new factories in the U.S. cancels out their persistent bad behavior with regard to dumping. More than that, however, they state that trade sanctions, in the form of tariffs or quotas, could cause them to reconsider their plans to invest more in U.S. manufacturing.
The reader should consider these arguments carefully. First, obeying the law some of the time does not justify violating it the rest of the time. Likewise, supporting U.S. manufacturing when it suits them does not justify Samsung and LG’s efforts to undermine their U.S. competitors in violation of U.S. trade laws. As President Trump has said, Americans are not against free trade, but they insist that it be fair trade, and trade which is designed to circumvent U.S. law is anything but fair.
In addition, the threats leveled by Samsung and LG should be seen for what they are: blackmail. For, if Samsung and LG are to be penalized for dumping washing machines produced overseas into the U.S. market, and if tariffs or quotas would then make selling such foreign-produced washing machines harder in the future, surely the rational business decision for these companies would be to produce more, not less, of their washing machines in the United States, since the machines produced here would not be subject to any trade sanctions. Instead, Samsung and LG propose to punish the United States, and its workers, by reducing their manufacturing activity in this country, if the U.S. government has the temerity to enforce its own laws. Such an action would be based on spite, pure and simple, and threats along these lines should make every American who cherishes the rule of law livid. They express the same sense of corporate entitlement that, for instance, we see in NFL teams that threaten to leave town if their demands for opulent new taxpayer-funded stadiums are not met.
The second reason why some backers of Samsung and LG say that the Trump administration should give those companies a pass is that, if tariffs or quotas are applied to these South Korean manufacturers, theoretically South Korea could respond with retaliatory measures. This is far-fetched. Any actions that the Trump administration might take will be targeted, not wide-ranging, and they certainly will not be designed to choke off trade. More importantly, as every American knows, tensions are running high on the Korean Peninsula. Now is the time when we have, arguably, the greatest leverage over the South Koreans, who need us to help neutralize the threat posed by North Korea. Does anyone believe that the South Koreans would start a trade war with the United States under these circumstances? Would South Korea choose washing machines over national security? Of course not.
The election of the Trump administration was due, in large part, to the American people’s frustrations over bad trade deals. Already, we have begun the process of renegotiating some of these deals. No deal will amount to anything, however, unless all parties concerned, including major corporations, are committed to upholding the integrity of these agreements and the rule of law. In the case against Samsung and LG, the Trump administration has a golden opportunity to defend U.S. manufacturing jobs and the rule of law simultaneously. Let us hope this chance will not be missed.