AKRON—To put it bluntly, the U.S. State Department's decision to pull out of the International Rubber Study Group is just plain stupid.
The excuses the State Department gives for withdrawing from the organization are lame, the reasoning inaccurate and short-sighted.
The IRSG is the only such body in the world's rubber industry—made up of government entities and a growing list of associate members, companies and other organizations with a stake in the world's rubber industry, particularly natural rubber. The group holds an annual meeting and, perhaps most importantly, is the world's primary source of statistical information on global supply and demand.
So why does the U.S. want to abandon the organization? It says the relevance of the data developed by the IRSG is questionable; the Rubber Manufacturers Association has complained about its statistical accuracy; China, the world's biggest NR user, isn't a member; no big international decisions are made at the group; and, if the U.S. needed to respond to a lack of access to NR—a dire situation in World War II—it would do so.
What a bunch of hogwash.
Did anyone in the State Department happen to look at the supply, demand and price situation for NR lately? Record prices that are debilitating to the U.S. rubber industry? Or did they check with the RMA, which complained five years ago about the IRSG numbers, but has no problem with them now? Or perhaps talked to the International Institute of Synthetic Rubber Producers, which is in partnership with the IRSG in statistics-gathering.
So China isn't a member (yet)—the U.S. policy now is to follow China's lead? Our European allies are members via the European Union, and many companies are joining the group's Panel of Associates. They seem to think the IRSG has relevance.
The world, as if the State Department didn't know already, is a global market. The U.S. doesn't sit on the sidelines when other economic issues arise, such as the global financial crisis and all the efforts made to keep the U.S.—and the world—from entering another Great Depression.
And therein probably lies the real reason behind this move: Money. Saddled with debt because of two wars, the bank bailout and the stimulus package—and pressured by the opposition party to cut the budget—the State Department has found an easy way to save a few bucks. And a very few bucks at that: only a little more than $100,000 annually. Not that the government has admitted to that.