If you didn't know much about the U.S. textile industry, you might say that Anderson Warlick's comments at the Beltwide Cotton Conferences in Atlanta sounded like sour grapes. Warlick, a vice president at Parkdale Mills in Gastonia, N.C., was complaining about the evolving definition in a speech on “Free Trade… What Kind of Yarn Are We Spinning?”
“I was taught we should demand that foreign markets be open for our goods in exchange for access to our markets,” he said. “Today, free trade means we open our markets, subsidize some foreign producers and not demand that they open their markets. If you complain, you are immediately called a protectionist and inefficient.”
Far from inefficient, U.S. mills have increased productivity by an average of 37.5 percent over the last decade. This gain was 30 percent larger than the average for all manufacturing.
Many U.S. open-end yarn spinners only have 4 to 6 cents per pound labor costs, he said. “So, how can a spinner 5,000 miles away transport yarn to a customer here at a lower price than we can offer?”
Are textile executives protectionist if they ask the government not to give a foreign competitor duty-free access to U.S. markets for geopolitical reasons?
“Pakistan, our ally in the war on terrorism, may be the only government to profit from the unfortunate events that happened on Sept. 11,” he noted. “They have had debt forgiven and quota relief, have been promised money for their economy and have had risk insurance eliminated.
“We need to help them, but there are more productive ways to accomplish this without hurting ourselves. If the war were somewhere else, they would be suffering like we are because of the bad economy.”
What about currency devaluations? In 1997, the currencies of textile exporting countries in Asia collapsed, causing “a shock wave of artificially low-priced textile and apparel products to hit the United States,” said Warlick.
“Because of pressure from abnormally low-priced Asian imports, prices for U.S. textile products have plummeted. In turn, U.S. textile profits have evaporated. More than 100 U.S. textile plants have closed and 60,000 textile workers have lost their jobs.”
Last June, the currencies of India, Indonesia, Pakistan, the Philippines, Sri Lanka and Taiwan were at record lows. China, in effect, devalued through increased use of export tax rebates. At the same time, the United States maintained a strong dollar policy to boost the Asian economic recovery.
Despite those U.S. efforts to help, Pakistan, China, Egypt, Bangladesh, Sri Lanka, Indonesia, Brazil and Thailand all have closed markets. “Almost two-thirds of the world's population is closed to U.S. products,” said Warlick.
And what about the billions of dollars of textile products that are illegally shipped into the United States annually? “Are we being protectionist if we ask that the U.S. government enforce the trade laws that we have?” Warlick asked.
To the uninitiated, that might sound like sour grapes. But to U.S. farmers and the survivors of the textile wars, Warlick's comments sound like questions that deserve an answer.