The Travels of a T-Shirt in the Global Economy

Chapter 9

In this section, the author takes readers through a journey of Chinese T-shirt makers from Asia to the U.S. The chairman of the American Manufacturing Trade Action Coalition (AMTAC), Auggie, was aware and against these foreign investors. According to Auggie, the government was supposed to stop Chinese apparel manufacturers from entering the U.S. market so that they do not hurt local ventures. Contrary to Auggie’s expectations, members of Congress, and retired politicians were calling for fair trade policies, which would encourage Chinese investors into the U.S. Various organizations, including ATMI, AMTAC, NTA, AYSA, AFMA, NCC, ASlA, ATMA, CRI GTMA THA AFAI NCMA and TDA united to fight against Chinese apparel firms in the nation (Rivoli, 2014). Subsequently, George Bush administration instituted safeguard quotas that restricted Chinese textile and apparel imports. In the author’s perspective, the political barriers to the Chinese apparel manufacturers to the U.S. were apparent. Harsh trade policies had continued to hurt the Chinese apparel market share in the U.S. The U.S. imports of cotton knit shirts from various nations had experienced a significant growth compared to imports from China. According to the writer, it was the trade policy rather than the comparative advantage that accounted for the trend.

Julia, an opponent of harsh trade policies in apparel industry invested efforts to promote free trade policies in the nation without success. She argued that the country should allow free access to the U.S. markets for all apparel that Central American Free Trade Agreement (CAFTA) members produce. Despite being a member of CAFTA, the U.S. has enacted various regulations to limit the access of foreign investors to the U.S. apparel market. Furthermore, the government implemented complex but different rules to control T-shirt imports from Sub Saharan Africa, the Caribbean basin, Ecuador, Columbia, and Mexico. For the free trade advocates like Julia, it was outrageous for the government to refer to its trade policies as “free trade agreements” while the participants’ access to the U.S. market were highly controlled.

Chapter 10

In this chapter, the author seeks to determine the reason for increased political influence and complex trade barriers in T-shirt industry at the era of progressive trade liberalization. According to the author, the apparel industry faced hostile foreign competition, and significant threats from imports post WWII. International apparel companies used unfair means of competition to humiliate local producers. Consequently, the government perceived the need to rescue the industry from potential failure and compensate interested entities for what they had persevered after the war. At the same time, the government had to stop international firms from harming one of the nation’s biggest industry and employer. Nevertheless, the strength of alliances in the sector and their access to policymakers helped in restricting the access of U.S. apparel to international players.

On the contrary, the diverse international businesses found it difficult to speak in one voice, thus a reduced bargaining power. The author points out that trade interest parties in the local apparel industry had a significant influence on foreign trade policies. The author further contends that every U.S. President post-World War II strived to promote free trade relations in the nation. While some of them did it to keep Communists at bay, some considered it the best economic policy. Despite these efforts, the authors argues that all the leaders have found it challenging to implement free trade policy without paying the textile and apparel industries to remove barriers. Albeit the robust efforts to achieve free trade policies, the U.S. may take an extended period to fulfill such initiatives.

Chapter 11

In this chapter, the author assesses the roles and impacts of trade policies in apparel and textile sectors. The U.S. implemented a protectionist system intended to protect traders in the two industries from unfair competition. Besides, the framers of the protectionist trade regulations were optimistic that these systems would spark the nation’s economy and protect jobs. The government used both restrictive quotas and tariffs on imported goods to promote local trade and discourage foreign investors. However, the policy still had adverse consequences on employment. Surveys suggest that rate of employment in these industries deteriorated as a result of technological advancements in the sector. Even if the policies protected these producers from foreign competition, they had to endure significant effects of internal rivalry and those firms seeking to preserve jobs could not survive in competitive environments.

The author points out the protectionist policies had more adverse effects on employment in China than the U.S. In this regard, China lost ten times as many textile jobs as did the U.S. between 1995 and 2002. Similar to the case in the U.S., production and revenues were rising despite massive job losses (Rivoli, 2014). More importantly, the author notes that quotas have encouraged China and other low potential producers to become high-end producers that translates to an increase in revenues. While the U.S. tightened quotas for the Chinese manufacturers, the latter shifted from one nation to another in a bid to survive in the textile sector. For example, Esquel Corporation, the world’s biggest cotton producer, moved its markets from the U.S. to Malaysia and finally settled in Mauritius and Maldives. The author attributes “global hopping” to trade policies advocating for tightened quotas for foreign investors.

Chapter 12

In this chapter, the book explains the state of apparel and textile industry after the end of temporary protectionism in 2009. As one would expect, China’s exports to the U.S. increased by an average of 400% with some categories rising as high as 1200 percent. After the quotas were lifted, it was apparent that China did not reflect as much product surges as people thought. The thought that there was only a brief window for China imports in the U.S. between both the Americans and Chinese accounted for the surges from China. Moreover, the surges were part of negotiations between the U.S. government and foreign nations. For most of the countries that feared that products from China would jeopardize their business with the U.S. importers, it became clear after 2005 that the U.S. consumer’s penchant for shopping left plenty of demand for all.

Subsequently, the time needed to deliver goods and proximity to the U.S. became essential factors for the nations exporting to the U.S. For example, Central American countries attracted business with the importers due to their proximity and speed of delivering the products. By 2008, China could not exploit the U.S. market at the desired levels as quotas still restricted their exports. However, China improved its market performance on the industry in 2009 when the government removed most of the quotas for Chinese products. Political influence continued to affect the performance of the sector in the entire Obama’s reign. The author further discusses various instances of trade wars in the history of the apparel sector, particularly the ones that affected the industry’s performance in Europe.