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July, 26th 2007

When are these people going to stop it?

– Liz Mair

Fantastic. A couple of weeks ago, Sens. Baucus and Grassley went crazy and decided to hike some energy taxes. Then, they decided that because someone works as a private equity guru--surprise-- they don't get to benefit from the same capital gains tax rate as the rest of us (maybe next week, we can create a special rate for teachers, a different one for policemen, and yet another different one for lawyers-- who knows where the fun will end!)

Now, these crazy kids, aided and abetted by Chuck "the Schmuck" Schumer and Lindsey Graham (unfortunately, this is the first thing Lindsey's done in awhile to annoy me) decided to get on with moving legislation to deal with the pressing problem of China's currency rigging, basically by way of bringing back protectionism. Way to go, guys!

Let's park for a moment my utter conviction that Baucus and Grassley are out to raise every damned tax, or anything that acts like a tax, that they can, and assess what's wrong with taking steps to "balance out" the effect of China's currency rigging. Essentially, what's wrong with it is, if it involves slapping-- or having slapped-- penalties or tariffs (or anything like them) onto Chinese products-- which is what this lovely bit of legislation is basically going to lead to-- it involves higher prices for American consumers. I mean, c'mon, it's not like the Chinese are going to go "oh dear, silly us, we were being anti-competitive, well, let's bear the burden of the [insert name of protectionist slap to the Chinese], and not pass it on to those who buy our product." Obviously, any extra cost that they incur as a result of this legislation will be passed on to consumers. And Americans buy, and rely on, a lot of Chinese products.

I'll be honest here: I don't trust China very much at all when it comes to the way they approach trade, intellectual property, defense-- anything, really. But just because someone's being a stupid ass, it doesn't mean you have to blow your own foot off in order to make the point. Much as I agree that China's currency rigging sucks, there's little to be gained by making American consumers pay more, just to give the Chinese the proverbial finger. Not that I expect Baucus, Grassley and Schumer, particularly, to get that.

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