Having grown up in the middle of southwest Louisiana's rice country with rice fields across the street from my childhood home, nothing says Louisiana to me like a plate of crawfish etouffe. In fact, crawfish and rice go so well together, not only on a plate, but also on farms, as they both grow in flooded fields.

Crawfish has recently been the subject of government involvement in the marketplace, as moves have been taken to protect Louisiana crawfish producers from competing with lower priced imported crawfish from China. Few crawfish lovers could fail to notice that imported frozen Chinese crawfish tails have been about $2 less per pound than Louisiana-grown crawfish tails. Louisiana crawfishers cried "unfair competition," claiming that the Chinese are "dumping" their crawfish here, which means selling at prices under costs. To help Louisiana crawfish producers, Senators John Breaux and Mary Landrieu have been at the forefront in getting a tariff placed on Chinese crawfish, supposedly to even out the playing field.

Grocers price both Louisiana and Chinese crawfish at amounts that both products can be sold. If there is a persistent $2 price gap, and both products are selling, then consumers must perceive a quality difference between the two products, otherwise Louisiana crawfish would pile up in the refrigerated sections of the grocery store. Louisiana crawfish are judged "better" by Louisiana consumers, a quality difference worth $2 per pound. To sell crawfish in Louisiana, importers of the Chinese product must price their tails substantially less than Louisiana crawfish. A tariff has been placed on Chinese crawfish, but Louisiana producers are trying to get an even higher tariff. With the tariff already in place, Louisiana crawfish prices have gone up, but the $2 price gap remains.

To make a claim of dumping, we should not only look at the price gap, but should also ask what the Chinese would gain by selling crawfish at prices below their costs. Costs, properly defined, are measured as benefits given up. Defined this way, selling below cost makes sense in only one circumstance: when the seller can expect to put its rivals out of business and then raise prices beyond ordinary prices to take advantage of its monopoly position and can expect to keep those prices high for a very long time. Lower Chinese crawfish prices may put some Louisiana producers out of business, but probably not the farmers who raise crawfish in their rice fields. It is so easy for Louisiana crawfish producers to get back into the business, that the Chinese cannot raise prices without attracting Louisiana producers back into the market. The Chinese producers simply cannot exploit a monopoly position in the market because they cannot keep Louisiana producers out of the market for long enough to make up losses from selling below cost.

From the Chinese point of view, dumping crawfish makes no sense. From the Louisiana producers' point of view, it makes sense to "claim" dumping, to get a tariff on their competitors product, so that they can raise prices.

The tariff that has been imposed and the even higher tariff that has been proposed only mean higher prices for Louisiana consumers. Before the tariff, with the competition from Chinese crawfish, many Louisiana consumers could afford Louisiana crawfish when they were selling at $5 per pound and Chinese crawfish were about $3 per pound. Poorer Louisiana consumers could afford the Chinese crawfish. Now, both are about $2 higher and more consumers are finding both unaffordable.

Once again, a smaller group of producers benefits from resorting to the political process to intervene in the market process, even though a much larger group of consumers suffers. Political action takes place when the gains are concentrated on a small group who find that it pays to take action and the losses are spread out over a larger group who find that that it doesn't pay to fight it.

With Senators Breaux and Landrieu leading the fight against Chinese crawfish interests, we can be sure of one thing, our Senators are not involved with Chinese campaign contributors.