September 22, 2009
Another great argument for free trade is the conversion of tax avoidance to productivity: the same argument that is (appropriately) made for simplifying the domestic tax code.
BALTIMORE -- Several times a month, Transit Connect vans from a Ford Motor Co. factory in Turkey roll off a ship here shiny and new, rear side windows gleaming, back seats firmly bolted to the floor.
The chicken tax -- the mohair subsidy's poultrified (-fried?) cousin -- is an LBJ-era trade spat that lives on. Western Europe taxed chicken from the US, so President Johnson taxed cargo vans. So now, the Turks make "passenger vans" with seats and windows that are removed and shredded. Presto, chango! Instant cargo van.
Any similarity you may feel between Chinese tires and chickens is all in your head. We wouldn't do anything that stupid -- this is the 21st Centaury!