Question

In your opinion, do trade protectionist policies and trade barriers hurt or help the American economy? Explain. Minimum 400 words

Answer 1

Protectionism and trade barriers are policies of protecting firms in the country through restriction of imports and expensive quotas on exports. There are a number of ways though which a country shields its businesses. Proponents of trade barriers argue that it positively affects home country traders through restriction of imports into the home country; it enables manufacturers to sell their goods solely in the market. It looks convincing in the short run. But if we are to look at long term implications of trade barriers, it is quite opposite. Trade barriers increase the price of imports; harms prospects both of countries, exporter and importer. There is wide consensus among the scholars that trade protectionism looks promising in the long run but trade openness has huge advantages in the long run. Proponents of trade openness attribute the cause of great depression to trade barriers; they believe that trade openness increase the access to variety of goods and services at lower costs.

Let us look at American Trade protectionist policies: It is bane or boon.

Economic historian Douglas Irwin busted the myth about trade protectionism and recorded his views in his book: Clashing over Commerce: A History of US Trade Policy notes in the year 2017. The author noted that relating lowering of trade barriers with great industrial power of USA is a misconception. It is not true that higher trade barriers catapulted America into great economic centre.

President Bush implemented tariffs on Chinese steel in the year 2002. Studies conducted to review trade protectionism policy revealed that US economy has suffered more harm than good due to this policy.

President Obama implemented trade protectionism against Chinese tyres between 2009 and 2012. A study in 2016 to evaluate this policy revealed that US economy was not impacted in any positive manner.

American experience with tariffs and trade has not helped much in achieving economic growth and development. Many studies have supported this notion. Many researchers have addressed the common myth: trade protectionism enhances economic growth and development. But researchers not in America but also in the entire world have one response to this statement; that it is just a myth. Statistical and economic data compiled by the researchers for studying various trade protectionism policies reveal no major positive impact on economy. Economists have unilaterally believed that trade openness is more fruitful in the long run.

Therefore, in view of the above facts I conclude that trade barriers hurt American economy.