Workers' Weekly On-Line
Volume 48 Number 18, June 16, 2018 ARCHIVE HOME JBCENTRE SUBSCRIBE

The Irrationality of Steel and Aluminium Tariffs

Failure of G7 Seen in International Trade Agenda

Banner reads: "The G7 Does Not Represent Us."

In an article in The Marxist-Leninist Weekly, Online Newspaper of the Communist Party of Canada (Marxist-Leninist), K C Adams writes: "Commentators have spoken and written reams regarding President Trump's imposition of tariffs on steel and aluminium and his refusal to sign a new NAFTA deal. This trade agenda is dominating the G7 Summit with claims that most members are opposed to tariffs and trade wars and want a rules-based system. All are united, however, when it comes to the global neo-liberal direction they have set for their economies and they refuse to admit that the G7 has given rise to disasters all over the world. G7 leaders and media speak as if the sky is falling and nothing can be done or understood of Trump's actions. International trade is made to appear as imponderable and beyond the grasp of mere mortals.

"First, anything is knowable following scientific investigation, discussion and analysis, including the actions of humans. Humans act according to the social conditions, the level of the productive forces, their outlook, interests, and the historical crib into which they are born. Trump acts according to his social conditions, outlook, private interests, and imperialist historical crib. His actions appear irrational with regard to trade because imperialist international trade has descended into anarchy and chaos, features of irrationality. International trade is captured within a contradiction. Its present condition demands cooperation but cut-throat competition between private interests to dominate the markets and sources of raw materials prevails. However, within the irrationality of the conditions, and their descent into chaos and crisis, meaning can be found, in particular the necessity for change and how to bring about that change."

Aluminium Imports into US and the 10 Per Cent Tariff

K C Adams continues: "The oligarchs in control of the steel and aluminium sectors are global actors with private interests scattered throughout the world. Oligopolies such as those formed by mining and aluminium producer Rio Tinto and global aluminium producer Alcoa are larger than many states in terms of gross income and the new value their workers produce. The concentration of social wealth and power in the hands of a few is unlike anything the world has ever seen. Alcoa has private interests in the US, Canada and elsewhere. Although these giants export aluminium into the US market, they appear to gain from the Trump 10 per cent tariff, as market prices for the metal have risen since the tariff became a talking point last January."

The article continues: "Trump's remarks that the aluminium tariff is meant to create jobs in the US sector do not appear to have substance. In fact, they appear irrational. The existing smelter capacity in the US is incapable of supplying the demand. Rebuilding smelter capacity would take years to accomplish and may itself be an irrational response under current conditions. The rise in market prices from tariffs could possibly allow Alcoa to re-commission several stalled US aluminium smelters it owns and controls but as yet it has not made any steps in this regard. The amount of potential production in the US is not large, and besides, international production from Alcoa can meet demand and increasing US production would depress prices. The current higher prices could stimulate more internal recycling of aluminium but again even that amount would come nowhere near to meeting current demand without the global supply from Canada, China, Russia and elsewhere."

Further on, K C Adams writes: "In 2012, the US produced 2,070,000 metric tonnes. Much of that productive capacity has been decommissioned, as imported aluminium from Canada, China and Russia is far more cheaply produced. The main already-produced value needed for primary aluminium production is bauxite and electricity. The transferred-value from electricity forms around one-third of the final price of production. The price of production of electricity is much higher in the US than in Canada, China and Russia.

"Trump's tariffs on aluminium imports will only make a small dent in the 6 million imported tonnes. Some US production may come on stream, probably from increased recycling. The biggest difference will be the higher market price, not only in the US but worldwide, at least for a time. The higher price is also a result of the global economic recovery from the 2008 crisis and the ever-increasing war preparations and global sales of military planes, missiles, bombs, ships and other means of destruction.

"Private interests concentrated within global companies characterised as oligopolies and cartels, such as Rio Tinto and Alcoa, have become supranational entities. They marshal their power of privilege, control, social wealth and contacts to manipulate in their favour the affairs of economies and states. They confront other private interests in a permanent condition of competition and collusion. The competition and collusion to serve their private interests and not the common good reduce all other considerations to secondary pragmatic issues, only of concern if they affect their primary aim and motive to expropriate as much as possible of the new value workers produce."

The article stresses: "The entire world is blocked from moving forward. The control of these private interests, these uber rich oligarchs concentrated in oligopolies and cartels, reduce the working people to spectators of their own economy, into impotent onlookers of the affairs that affect their lives. The main business and actions of states have been reduced to serving the private interests of competing oligarchs resulting in a continual condition of civil war for political power and control." K C Adams points out: "The supranational control and decisions of the oligarchs have surpassed even the mysteries of state, as the situation degenerates into global anarchy, recurring crises, constant war and irrationality."

The article concludes: "The decisions of Trump, Trudeau and other G7 members on trade are of this obscurantist nature. They reflect the irrationality of a world gone mad in competition to serve powerful private interests in a race to be first and dominant. Imperialist competition is in contradiction with the necessity for cooperation to solve the problems of today's economy and world. The ruling oligarchs and their mania to serve their private interests and all else be damned is out of sync with the modern world and its socialised productive forces. Today's world and its peoples are interconnected; their economies are interrelated. They need cooperation for mutual benefit and development to solve their problems and allow the productive forces of industrial mass production and social product to reach their full potential to guarantee the well-being and security of all and not the narrow private interests of a privileged few. They need the human factor/social consciousness and empowerment now of the working people to bring this necessary cooperation and unity into being.

"This world of socialised productive forces has the material capacity to sort out all problems facing humans and the social and natural environment. What is absent from making it happen? There is not any attempt to make rational the irrationality of the actions of the oligopolies and their political servants and states and their unbridled competition to favour their narrow private interests. Crucially absent is the empowerment and control of the actual producers, the working people within the socialised economy where they work and live. The pro-social aim, outlook and potential control of the working people are in conformity with the modern social and productive conditions. They are the necessary human factor to sort things out. The struggle is centred on empowering and bringing into being the control and pro-social aim of the working people.

"International trade under the modern productive forces is understandable only within the pro-social outlook, interests, and social conditions of the actual producers who create the social wealth and reproduce their own human condition and the socialised economy. The working people, the mere mortals who are the essential human factor of the modern world, have to empower themselves now and emerge from under the suffocating anti-social control and outlook of the imperialist oligarchs. They have to become masters of their own thinking, outlook and interests and extend their control to all the affairs of the economy and state that affect their lives. This is the only way to make international trade rational. This is the only way to bring sense to their lives and open a path forward."


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