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Whirlpool Makes the Case for Protectionism

Whirlpool Makes the Case for Protectionism

10/05/2017

 By Andrew Tangel 

The humble washing machine is becoming a new trade battleground between Washington and its international partners.

After years of dominating the U.S. market, Whirlpool Corp. is struggling to hold off stiff competition from South Korea's Samsung Electronics Co. and LG Electronics Inc., which have made inroads with American consumers with their sleek designs and pleasant chimes.

Whirlpool, of Benton Harbor, Mich., has won a series of conventional regulatory skirmishes by arguing its rivals are using anti-market practices to gain an edge, such as selling their appliances for less than the cost of producing them.

Now it's asking Washington to rescue it with one of the most potent -- and controversial -- weapons in its arsenal. The long-dormant protectionist measure doesn't require a U.S. industry to show that foreign competitors are cheating -- only that it has suffered "serious injury" from imports.

The decision over the 1970s-era provision, known as the "safeguard" law, is in the hands of the U.S. International Trade Commission, an independent, bipartisan federal agency, which is expected to rule Thursday on whether to recommend action by President Donald Trump. The ITC last month approved a separate petition for relief by U.S. solar-panel makers, and the Trump administration is awaiting specific remedy proposals from the body before making a final decision.

"If we had a level playing field, we would sell more, we would hire -- we believe -- at least 1,300 people," Whirlpool Chairman Jeff Fettig said in an interview.

The Trump administration has vowed to take a fresh look at a wide range of protectionist powers in pursuit of its "America First" trade agenda. Trump aides have in recent months considered dusting off other trade-law provisions to pressure China over intellectual property, and to protect U.S. steel and aluminum makers.

This marks a break with previous administrations from both parties, which played down unilateral actions in deference to global arbiters such as the World Trade Organization. Remedies under the safeguard law were last invoked by George W. Bush to protect the U.S. steel industry, in 2002. The administration soon removed the steel tariffs after the WTO deemed them improper, and industries had, until now, been discouraged from pursuing such protection.

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