Yes and No on Shoes

The decision was Jimmy Carter's first major one on foreign trade, and he weighed it gravely, presiding over a long meeting of the Administration's Economic Policy Group and even penning several paragraphs of the final announcement. In the end, he rejected an International Trade Commission recommendation to quadruple tariffs on many foreign shoes, to 40%. Declared the President: "I am very reluctant to restrict international trade in any way."

That said, Carter proposed to restrict trade in a "modest" way. He will try to negotiate agreements with South Korea and Taiwan under which those nations would "voluntarily" cut back exports to the U.S.--mainly of work, athletic and vinyl shoes--in return for a pledge of no tariff increase. The Administration hopes that other nations, such as Italy, Spain and Brazil, will reduce their shoe sales in the U.S. (or at least not increase them) without formal negotiations. The President also pledged to ask Congress for federal aid to the domestic shoe industry that could total $1 billion over the next decade. Said Trade Negotiator Robert Strauss: "We knew this decision wouldn't satisfy anybody."

It did not. The AFL-CIO and Congressmen from shoe-producing states voiced loud displeasure that Carter did not go for tougher restrictions. Free traders will not be overjoyed either, but they have less reason for dismay. Had Carter done no more than reject the ITC recommendation, Congress would probably have overridden his decision and forced enactment of the tariff boost; it might do so anyway. The decision indicates that even under heavy protectionist fire, the President will choose, if not all-out free trade, then as much free trade as he can get away with.

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