Whenever someone cries foul that they can't compete on a level playing field and are therefore owed an unfair advantage relative to the their global competition, it's usually a sign that they've either underinvested in global sourcing capabilities themselves or have such a bloated cost structure -- or artificially high margins -- that any true free market would put them out of business. Such is the case of Legatt & Platt as well as numerous other companies involved in the metals (finished and semi-finished products, primarily) business according to a recent post on Spend Matters affiliate blog Metal Miner. Unfortunately, however, thanks to the rhetoric from anti-free trade candidates -- or the "fair-trade" candidates, as they call themselves -- protectionist views are on the rise in the US. As these views become more mainstream and as the US turns inward, these complaints will only increase -- and US manufacturers will be at a significant disadvantage relative to their global peers.
Think about the logical extension of the current state of anti-dumping complaints. Perhaps in the non-manufacturing world, maybe we'll one-day see Accenture or Deloitte file anti-dumping claims against Infosys and Tata for taking number crunching and SI work offshore at "below market prices" (even though they're doing it too). It might sound crazy today, but believe me, we're headed in that direction. In my view, the willingness of the courts to hear anti-dumping cases amounts to a new type of potential unknown tariff and supply risk against anyone potentially engaged in global sourcing where domestic alternatives exist. Now that's a scary thought -- and it's one to think about when you go to the polls in November.
- Jason Busch