Antidumping Exposed: The Devilish Details of Unfair Trade Law

The U.S. antidumping law enjoys broad political support in part because so few people understand how the law actually works. Its rhetoric of “fairness” and “level playing fields” sounds appealing, and its convoluted technical complexities prevent all but a few insiders and experts from understanding the reality that underlies that rhetoric.

CONNUM? CEP? FUPDOL? TOTPUDD? DIFMER? NPRICOP? POI? POR? LOT? Confused? You’re not alone. Even members of Congress, whose opinions shape the course of U.S. trade policy, are baffled by those devilish details.

This book seeks to penetrate the fog of complexity that shields the antidumping law from the scrutiny it deserves. It offers a detailed, step-by-step guide to how dumping is defined and measured under current rules. It identifies the many methodological quirks and biases that allow normal, healthy competition to be stigmatized as “unfair” and punished with often cripplingly high antidumping duties. The inescapable conclusion is that the antidumping law, as it currently stands, has nothing to do with maintaining a “level playing field.” Instead, antidumping’s primary function is to provide an elaborate excuse for old-fashioned protectionism.

What goes around comes around. As traditional tariff barriers have been gradually lowered throughout the world, antidumping has emerged to fill the void. India, China, South Africa, Brazil, and dozens of other countries have adopted and implemented their own antidumping laws. In recent years, U.S. exports have been targeted with increasing frequency.

It was this trend that the Bush administration cited as justification for agreeing to antidumping negotiations in the Doha Round of global trade talks. Powerful political forces, however, seek to prevent U.S. acceptance of any meaningful reform. Steel producers and other import-competing industries have long dominated the formulation of U.S. antidumping policy. Their lobbying has made the U.S. law increasingly protectionist and caused U.S. trade negotiators to block improved international rules.

Continued U.S. opposition to reform would carry high costs. Without substantive changes to antidumping rules, the Doha Round is likely to fail.

Accordingly, the authors offer 20 specific proposals for reform of the World Trade Organization’s Antidumping Agreement. Their analysis and ideas should be of great interest to businesses, trade lawyers, and trade negotiators around the world.

“Politicians everywhere like to declare they’re for ‘fair trade,’ not ‘free trade.’ Brink Lindsey and Dan Ikenson show just how unfair ‘fair trade’ can be. This superb exposé of the shortcomings of antidumping is a must read for policymakers everywhere, especially those who believe antidumping laws are sacrosanct.”
–Clayton Yeutter, former U.S. Trade Representative

“Brink Lindsey and Dan Ikenson have made an important contribution to the often acrimonious debate about antidumping laws and their ‘devilish details.’ This book, which combines incisive analysis and extensive empirical research, should be very important reading for everyone interested in antidumping, particularly the negotiators and other public officials who have to deal with this troublesome subject.”
–John H. Jackson, Georgetown University Law Center and
author, The World Trading System

“This is sound professional work that digs out what the facts really are in instances in which politically powerful industries have obtained protection under antidumping laws here and abroad. The book demonstrates that complicated and expensive antidumping investigations serve one and only one function: to provide ‘plausible deniability’ for antidumping’s political supporters.”
–J. Michael Finger, American Enterprise Institute and
author, Antidumping: How It Works and Who Gets Hurt

“Antidumping has been called the ‘third rail of American trade politics’ because politically powerful special interests enjoy the protection it provides. Brink Lindsey and Dan Ikenson have performed the great service of making antidumping trade policy understandable and transparent. In this well-written book, they expose antidumping policy as something very different from the ‘fair trade’ that it purports to be. They do more than just provide a devastating critique of U.S. antidumping practice-they provide a sorely needed and well thought out road map for reform. This important book on a longstanding and thorny trade policy problem should be required reading for anyone interested in current trade issues.”
–Douglas A. Irwin, Dartmouth University and author, Free Trade under Fire

“For years, American companies have taken advantage of an obscure statute-the antidumping law-to punish foreign firms that give American consumers a bargain; American companies claim that the foreign companies are ‘dumping’ their products in our market. In this book, Brink Lindsey and Dan Ikenson expose the hypocrisy of those attacks on practices that are engaged in by American firms on our soil, all perfectly lawfully and justifiably. This book is a long overdue and welcome contribution that should be read by policymakers and informed citizens alike.”
–Robert E. Litan, Brookings Institution and coauthor, Globaphobia: Confronting Fears about Open Trade and coeditor, Down in the Dumps: Administration of the Unfair Trade Laws”

Brink Lindsey is director of the Cato Institute’s Center for Trade Policy Studies and author of Against the Dead Hand: The Uncertain Struggle for Global Capitalism. Daniel J. Ikenson is a policy analyst with the Cato Institute’s Center for Trade Policy Studies.