Anyone with a heart would sympathize with the plight
of American shrimpers. As reporter John DeSantis of the Houma, La.,
Courier, aptly put it, the economics of the shrimp industry can be
summed up in one word: "decimated."
Imports, which have been dramatically increasing for
more than a decade, surged another 16 percent, to $3.6 billion in 2001,
and then surged again last year.
Meanwhile, prices have tanked to the 1970s level.
Discouraged shrimpers are draining the bilges on their boats and bailing
out of the business.
"Our backs are to the wall," says George
Barisich, president of the Louisiana Shrimp Association. When I reached
him on his cell phone recently, Barisich was on his boat braving an
incoming tropical storm, "trying to catch a few shrimp," he
explained.
So, what to do?
Barisich and the recently formed Southern Shrimp
Alliance, comprising eight southern states ranging from Texas to the
Carolinas, want to file an antidumping action aimed at imposing high
tariff barriers on some 16 shrimp-exporting countries, mainly from Asia
and Central America. In early December, the SSA hired Dewey Ballantine
to investigate allegations of dumping (see Newsline story).
Will the strategy work?
Experience strongly suggests otherwise.
Protectionism never works in the long run. Much like an aspirin gives
temporary headache relief, protectionism can disrupt and divert trade
flows, but not forever. It's like dying slowly.
The only people who get rich from protectionism are
the Washington lawyers who send their children to expensive private
schools from the revenues of trade cases.
Ask Louisiana crawfish producers, who received
Louisiana taxpayer money to hit exporters of frozen Chinese crawfish
tail meat with 100-plus percent antidumping tariffs in the late 1990s.
While Chinese crawfish was supposed to be wiped out of American markets,
it didn't happen. You still see the Chinese product in supermarkets,
even in New Orleans.
Or ask the domestic salmon industry, which won an
antidumping case against Chile in 1997. You can still buy farmed salmon
fillets from Chile in supermarkets for $5 to $7 per pound, at least a
couple of bucks cheaper than wild, domestic salmon.
The numbers simply aren't with domestic shrimpers,
who only catch enough shrimp to supply some 12 percent of the U.S.
market. The foreign competition grows its shrimp in ponds; it's like
fishing in a hatchery. And even if an antidumping suit would drive 16
countries out of the shrimp exporting business, this would still leave
more than 20 others who would have the incentive to rush in to capture a
share of some $1.4 billion in annual U.S. revenues.
Alas, not every domestic shrimper will survive. But
there will always be a thriving niche market for creative entrepreneurs
who understand the attractiveness of fresh American shrimp and know how
to market it.
As Wally Stevens, the president of Slade Gordon & Co. - a major
purchaser of both foreign and domestic shrimp - says, his company will
keep on selling as much wild ocean-caught American shrimp as it can.
Smart advice to shrimpers: Don't call your lawyer,
call Wally.
Greg Rushford is editor and
publisher of The Rushford Report, a Washington monthly newsletter on
trade politics at www.RushfordReport.com.
