The Wall Street Journal

Thursday, January 21, 1993
Letters to the Editor: Rubber Makers Need Time to Bounce Back

"The Great Federal Panty Raid" by James Bovard (editorial page,
Dec. 18) is an erroneous analysis of our section 201 extruded rubber
thread determination. He misstates the recommendation we made to the
president. As our Dec. 2 statement made clear, additional tariffs
would be imposed only on imports that exceed 50% of U.S. annual
consumption (17 million pounds in 1993), not on all imports as Mr.
Bovard reported. Given current tariffs, imports are projected to be
well below this level. Therefore, Mr. Bovard is wrong in stating
that U.S. industries that use rubber thread, such as pantyhose and
underwear producers, would be damaged by this trade action. It is
ludicrous for him to project more than 3,000 jobs lost from this
action. The remedy we recommend only safeguards the U.S. industry
from another massive and unexpected surge in imports while it is
adjusting to import competition through cost-saving investment.

This action is in no way "a vain attempt to compensate two small
companies for the fact that rubber trees do not grow in America."
Being close to rubber plantations yields no overall cost advantage
in the production of rubber thread for sale in the U.S. market. One
pound of latex is manufactured with other chemicals and additives
into more than one pound of extruded rubber thread. So, it actually
can be more cost-effective to transport the raw latex rather than
the finished rubber thread. Mr. Bovard's mere facts of geography do
not make sound policy analysis.

In our judgment, the domestic producers have the capability to
adjust to import competition if they are given a reasonable
opportunity to do so. If the U.S. producers fail to implement the
adjustment plans they have submitted to us, the import relief will
be terminated. In short, if the president adopts our determination
and remedy recommendation, we intend to hold the domestic industry's
feet to the fire to ensure they make good use of the temporary

Don E. Newquist


David B. Rohr

Janet A. Nuzum


U.S. International Trade Commission